Marylebone leases on residential properties are gradually losing value. Where your lease has approximately 90 years unexpired, you should start thinking about a lease extension. If lease term is less than eighty years, you will then have to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to your landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Flat owners in Marylebone will mostly qualify for a lease extension; however a solicitor will check your eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to comply with once the process is triggered so it’s wise to be guided by a lawyer during the process.
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be worth the same as a freehold for decades to come.
| 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with procure Marylebone 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 conveyancing solicitor we work with provide it.
Caleb was the the leasehold proprietor of a conversion apartment in Marylebone on the market with a lease of just over sixty years outstanding. Caleb on an informal basis contacted his freeholder being a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent initially set at £150 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Caleb to exercise his statutory right. Caleb obtained expert advice and was able to make an informed judgement and handle with the matter and readily saleable.
In 2011 we were called by Mrs Rachel Martínez who, having was assigned a lease of a garden apartment in Marylebone in March 2010. The question was if we could approximate the price would be for a ninety year lease extension. Similar residencies in Marylebone with an extended lease were worth £300,000. The mid-range ground rent payable was £50 billed monthly. The lease lapsed in 2102. Taking into account 76 years unexpired we approximated the premium to the landlord to extend the lease to be between £8,600 and £9,800 exclusive of legals.
An example of a Lease Extension case for a Marylebone residence is Flats 37 & 39 88/90 Portland Place in December 2010. The Tribunal determined that the premium payable for the lease extensions in respect of these two flats is as follows:- For Flat 37, the sum of £385,230.00 For Flat 39, the sum of £436,780.00 This case was in relation to 2 flats. The unexpired lease term was 24.02 years.