Unfortunately that a Old Ford residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Old Ford property prices.Where your lease has approximately ninety years left, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips below eighty years - otherwise a higher premium will be payable. Most leasehold owners in Old Ford will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you qualify for an extension. In some cases you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process is initiated and you will need to be guided by your lawyer throughout the process.
It is generally considered that a residential leasehold with more than 100 years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to any lease with more than 35 years remaining, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 Old Ford,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Old Ford valuers.
During the course of the last few months Kai, started to get near to the 80-year threshold with the lease on his leasehold apartment in Old Ford. Having bought his home two decades ago, the lease term was of little concern. Luckily, he became aware that he would imminently be paying way over the odds for Extending the lease. Kai arranged for a lease extension just in the nick of time last September. Kai and the landlord subsequently settled on an amount of £5,500 . If the lease had descended below eighty years, the figure would have increased by a minimum £875.
Last Spring we were contacted by Mr and Mrs. D Adams , who took over the lease of a one bedroom flat in Old Ford in July 1996. The dilemma was if we could approximate the compensation to the landlord would be for a 90 year lease extension. Comparative properties in Old Ford with a long lease were valued around £260,000. The mid-range ground rent payable was £50 invoiced monthly. The lease end date was in 2095. Having 71 years unexpired we approximated the premium to the landlord to extend the lease to be between £9,500 and £11,000 plus professional charges.
An example of a Freehold Enfranchisement matter before the tribunal for a Old Ford 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.