Top reasons for Downe lease extension

Top reasons for lease extension now:

A Downe leasehold property depreciates with the years remaining on the lease.

It’s an underpublicised truth that a Downe residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Downe property market.Where your lease has approximately 90 years left, you should start thinking about a lease extension. If the number of years remaining falls below eighty years, you will then be required to pay 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of leasehold owners in Downe will be able to extend under the legislation; however a conveyancer will be able to clarify if you are eligibility. In some situations you may not qualify. There are also strict timeframes and procedures to follow once the process is instigated and you will need to be guided by your conveyancer from beginning to end of the process.

An extended lease has roughly the same value as a freehold

It is conventional wisdom that a property with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for decades to come.

Mortgage lenders may not loan monies with a short lease

The propensity since 2008 has been for banks to tighten lending criteria across the board - this has extended to the types of security over which the home loan is to be charged. This has resulted in the unexpired lease term required by banks has increased. In the past banks would grant a mortgage on a lease with twenty years plus the term of the loan - routinely fifty year leases but those requirements are being increasingly undermined by the requirement for lengthy leases - many use a minimum term of 75 years as standard.

What makes us experts in Downe lease extensions?

The conveyancers that we work with procure Downe lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.

Downe Lease Extension Example Cases:

Ben, Downe, South East London

In recent months Ben, started to get near to the eighty-year threshold with the lease on his leasehold apartment in Downe. In buying his home twenty years ago, the lease term was of no significance. by good luck, he realised he needed to take steps soon on a lease extension. Ben was able to extend his lease at the eleventh hour in July. Ben and the freeholder via the managing agents in the end agreed on an amount of £5,500 . If the lease had fallen lower than eighty years, the premium would have gone up by at least £1,075.

Downe case:

In 2013 we were phoned by Mr H Wood who, having purchased a studio apartment in Downe in June 2000. We are asked if we could approximate the premium would be for a ninety year extension to my lease. Comparative residencies in Downe with an extended lease were valued about £295,000. The average amount of ground rent was £50 collected yearly. The lease elapsed in 2101. Taking into account 75 years unexpired we estimated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 not including fees.