Unfortunately that a Lambeth residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the depreciation being disguised by increases in the Lambeth property prices.Once your lease nears 85ish years, you need to start considering a lease extension. If the number of years remaining falls below eighty years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property Most leasehold owners in Lambeth will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify whether you are eligibility. In some cases you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer throughout the formalities.
It is generally considered that a property with in excess of 100 years remaining is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a landlord in Lambeth,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Lambeth valuers.
In recent months Noah, started to get close to the 80-year threshold with the lease on his leasehold flat in Lambeth. In buying his property twenty years ago, the unexpired term was of no relevance. As luck would have it, he recognised he would imminently be paying an inflated amount for a lease extension. Noah extended the lease just under the wire in April. Noah and the freeholder eventually agreed on a premium of £6,000 . If the lease had descended to less than 80 years, the sum would have gone up by a minimum £1,150.
Last Autumn we were called by Mrs Isabelle Davis , who acquired a one bedroom flat in Lambeth in September 2005. The dilemma was if we could approximate the compensation to the landlord would likely be to extend the lease by ninety years. Comparable residencies in Lambeth with a long lease were worth £295,000. The average ground rent payable was £45 invoiced quarterly. The lease came to a finish on 3 February 2099. Taking into account 74 years left we estimated the compensation to the landlord for the lease extension to be within £8,600 and £9,800 plus expenses.
An example of a Lease Extension matter before the tribunal for a Lambeth residence is Flats 12A & 19, Evelyn Mansions Carlisle Place in June 2009. The Tribunal held that the price to be paid for the new lease of Flat 12A is £168,824, For the other flat the price was set at £169,110 This case affected 2 flats. The unexpired term as at the valuation date was 56 years.