With a residential leasehold premises in Parsons Green, you are actually purchasing an entitlement to live in a property for a set period of time. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you may consider a lease extension sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease increases markedly notably when there are less than 80 years remaining. Residents in Parsons Green with a lease nearing 81 years remaining should seriously think of extending it as soon as possible. Once the lease term has under 80 years outstanding, under the relevant legislation the freeholder is entitled to calculate and levy a larger premium, assessed on a technical calculation, strangely termed as “marriage value” which is payable.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Engaging our service will provide you better control over the value of your Parsons Green leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Trailing protracted negotiations with the landlord of her purpose-built apartment in Parsons Green, Aimee commenced the lease extension process just as the lease was coming close to the critical 80-year deadline. The legal work was concluded in April 2005. The landlord’s charges were negotiated to a tad over 600 pounds.
Last Christmas we were approach by Mrs Alexandra Patel , who acquired a one bedroom apartment in Parsons Green in June 1996. We are asked if we could estimate the compensation to the landlord would be to prolong the lease by ninety years. Identical residencies in Parsons Green with an extended lease were in the region of £235,200. The mid-range amount of ground rent was £45 collected annually. The lease ended in 2090. Taking into account 66 years remaining we calculated the premium to the landlord to extend the lease to be between £12,400 and £14,200 not including expenses.
An example of a Freehold Enfranchisement case for a Parsons Green premises is 66 and 66a Wardo Avenue in November 2012. The Tribunal determined that the sum of £8,048 is payable by the Applicants in respect of the price for the freehold of the property This case affected 2 flats. The unexpired residue of the current lease was 93 years and 162 years.