Malpas leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. It is the case that most Malpas tenants have the right to extend their lease by an additional ninety years under the 1993 Leasehold Reform Act. If you are a leasehold owner in Malpas you should see if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under eighty years, the amount payable for any lease extension increases dramatically as part of the premium you pay is what is known as a marriage value
It is conventional wisdom that a residential leasehold with more than one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years remaining, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Regardless of whether you are a tenant or a landlord in Malpas,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Malpas valuers.
In the wake of eight months of protracted correspondence with the freeholder of her first floor apartment in Malpas, Lucy started the lease extension process as the eighty year threshold was fast approaching. The lease extension was concluded in January 2007. The freeholder’s costs were kept to an absolute minimum.
Last year we were approach by Dr Jodie Khan , who bought a basement flat in Malpas in March 1999. We are asked if we could approximate the price would be to prolong the lease by ninety years. Similar residencies in Malpas with a long lease were worth £176,200. The mid-range ground rent payable was £65 collected quarterly. The lease end date was on 6 August 2081. Having 56 years left we estimated the compensation to the freeholder for the lease extension to be within £29,500 and £34,000 plus expenses.
Dr I Dupont was assigned a lease of a first floor flat in Malpas in August 2007. The dilemma was if we could estimate the compensation to the landlord would be for a ninety year lease extension. Comparable residencies in Malpas with a long lease were worth £242,600. The mid-range amount of ground rent was £45 invoiced per annum. The lease ran out on 12 March 2092. Given that there were 67 years left we approximated the compensation to the freeholder to extend the lease to be between £11,400 and £13,200 exclusive of legals.