The market value of a leasehold property in Ponders End is impacted by how long the lease has left to run. If it is near to or fewer than eighty years you should envisage difficulties on re-sale, so it is recommended to arrange for a lease extension ahead of buying. Ideally one should start the lease extension process when the lease still has 82 years remaining so that formalities can be addressed ahead of the eighty year cut off point. Current legislation enables Ponders End qualifying lessees to an additional term of ninety years over and above the remaining term, at a notional rent (no ground rent). The purpose of the valuation is to determine the sum payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold premises in Ponders End with more than one hundred years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Godiva Mortgages | 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with procure Ponders End 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.
In recent months Alfie, came seriously near to the eighty-year threshold with the lease on his two bedroom flat in Ponders End. In buying his property twenty years ago, the lease term was of no concern. Luckily, he realised he would imminently be paying way over the odds for Extending the lease. Alfie extended the lease just under the wire in March. Alfie and the landlord ultimately agreed on a premium of £5,000 . If he failed to meet the deadline, the premium would have increased by at least £875.
Mr and Mrs. J Edwards took over the lease of a ground floor flat in Ponders End in October 1996. The question was if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Identical properties in Ponders End with an extended lease were valued around £267,600. The mid-range ground rent payable was £65 collected monthly. The lease elapsed on 8 January 2093. Having 67 years as a residual term we calculated the compensation to the landlord for the lease extension to be between £14,300 and £16,400 plus legals.
An example of a Vesting Order and Purchase of freehold matter before the tribunal for a Ponders End premises is Ground Floor Flat 4A Baronet Road in February 2010. Following a vesting order by Edmonton County Court on 23rd December 2008 (case number 8ED064) the Tribunal decided that the price that the Applicant for the freehold interest should pay is £8,689.00 This case related to 2 flats. The unexpired residue of the current lease was 80.01 years.