Mitcham leases on residential properties are gradually losing value. Where your lease has approximately 90 years remaining, you should start considering the need for a lease extension. 80 years is a significant number: when the unexpired term of a lease drops below this level then you begin incurring an additional element called marriage value. Leasehold owners in Mitcham will mostly qualify for a lease extension; however a solicitor should be able confirm if you qualify. In certain circumstances you may not be entitled. There are also strict deadlines and procedures to follow once the process is triggered so it’s wise to be guided by a conveyancing solicitor 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 additional 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Lease extensions in Mitcham can be a difficult process. We recommend you secure guidance from a lawyer and valuer well versed in the legislation and lease extension process.
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 procuring Mitcham lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Jamie was the the leasehold proprietor of a conversion apartment in Mitcham being marketed with a lease of fraction over sixty years outstanding. Jamie on an informal basis spoke with his landlord a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £200 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Jamie to invoke his statutory right. Jamie obtained expert legal guidance and was able to make a more informed judgement and deal with the matter and readily saleable.
Last Autumn we were contacted by Dr V Wilson , who completed a basement flat in Mitcham in July 1999. The dilemma was if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Comparable properties in Mitcham with a long lease were in the region of £200,000. The average ground rent payable was £50 billed every twelve months. The lease concluded on 3 May 2103. Considering the 77 years as a residual term we estimated the compensation to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of legals.
An example of a Freehold Enfranchisement matter before the tribunal for a Mitcham residence is 50 & 52 Southcroft Road in September 2013. The tribunals own valuation determined that the premium payable should be £29,000 This case affected 2 flats. The unexpired term was 86.11 and 60.64.