Unfortunately that a Mile End residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the depreciation being disguised by increases in the Mile End property prices.Once your lease nears 85ish years, you should start considering a lease extension. If the number of years remaining dips under 80 years, you will then be required to pay half of the property's 'marriage value' in addition to 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 The majority of flat owners in Mile End will be able to extend under the legislation; however a lawyer should be able to clarify if you qualify for an extension. 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 conveyancing solicitor for the duration of the process.
It is generally considered that a property with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the residence will be worth the same as a freehold for many years ahead.
| 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. |
| Chelsea 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. |
| Leeds Building Society | 85 years remaining from the start 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 |
Lease extensions in Mile End can be a difficult process. We recommend you secure guidance from a conveyancer and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Mile End lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In the wake of eight months of protracted discussions with the landlord of her studio flat in Mile End, Ellie started the lease extension process as the eighty year threshold was quickly advancing. The legal work was finalised in May 2011. The freeholder’s charges were kept to an absolute minimum.
Last Spring we were phoned by Dr Matthew Murphy , who was assigned a lease of a studio flat in Mile End in November 2002. The question was if we could approximate the price would likely be to extend the lease by a further 90 years. Similar homes in Mile End with an extended lease were valued around £198,800. The average ground rent payable was £55 billed quarterly. The lease finished on 23 October 2079. Given that there were 55 years remaining we approximated the premium to the freeholder for the lease extension to be between £33,300 and £38,400 not including professional charges.
An example of a Freehold Enfranchisement case for a Mile End property is 26 Rhondda Grove in June 2009. The net price payable by the leaseholders as determined by the Tribunal was £3,015.13. This comprised £11,300 premium for the reversion less £8,284.87 costs as ordered by the County Court.