Ely leases on residential properties are gradually losing value. Where your lease has approximately 90 years remaining, you should start thinking about a lease extension. If lease term is under 80 years, you will then have to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Flat owners in Ely will mostly be legally entitled to a lease extension; however It would be wise to check with a lawyer to check your eligibility. In certain situations you may not qualify. There are prescribed deadlines and formalities to comply with once the process is initiated so it’s wise to be guided by a conveyancing solicitor during the process.
Leasehold properties in Ely with over one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Yorkshire Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
Irrespective of whether you are a tenant or a freeholder in Ely,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Ely valuers.
During the course of the last few months Hunter, came precariously close to the 80-year mark with the lease on his garden apartment in Ely. In buying his property 19 years ago, the length of the lease was of little significance. by good luck, it dawned on him that he would soon be paying an inflated amount for a lease extension. Hunter arranged for a lease extension at the eleventh hour last April. Hunter and the landlord in the end settled on an amount of £5,500 . If the lease had descended to less than eighty years, the sum would have become more costly by at least £1,100.
Dr Chloe Bennett bought a studio flat in Ely in August 2002. We are asked if we could approximate the compensation to the landlord would be to extend the lease by 90 years. Comparative residencies in Ely with an extended lease were valued around £290,000. The average amount of ground rent was £45 billed annually. The lease ran out in 2098. Taking into account 72 years left we approximated the premium to the freeholder to extend the lease to be within £11,400 and £13,200 exclusive of fees.
In 2010 we were contacted by Dr Emily Bonnet who, having acquired a studio flat in Ely in May 2003. The question was if we could approximate the premium would be for a 90 year extension to my lease. Similar flats in Ely with 100 year plus lease were worth £233,200. The average ground rent payable was £60 collected annually. The lease ran out on 5 January 2087. Having 61 years remaining we estimated the compensation to the landlord for the lease extension to be between £22,800 and £26,400 plus professional charges.