It’s an underpublicised truth that a Rainham residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Rainham property market.Once your lease nears 85ish years, you should start considering a lease extension. If lease term slips under eighty years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property Most flat owners in Rainham will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify whether you are eligibility. In some situations you may not be entitled. There are also strict timetables and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer throughout the formalities.
It is conventional wisdom that a property with in excess of one hundred years remaining is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
The conveyancers that we work with handle Rainham 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 conveyancer we work with provide it.
Off the back of protracted correspondence with the landlord of her leasehold apartment in Rainham, Rhiannon started the lease extension process as the 80 year threshold was fast approaching. The transaction was finalised in March 2008. The landlord’s fees were kept to an absolute minimum.
Last Autumn we were called by Mr C Stewart , who acquired a one bedroom apartment in Rainham in January 2005. We are asked if we could shed any light on how much (roughly) price could be to extend the lease by 90 years. Comparative residencies in Rainham with an extended lease were worth £218,000. The mid-range ground rent payable was £45 billed monthly. The lease ended in 2088. Taking into account 63 years outstanding we calculated the premium to the landlord for the lease extension to be within £17,100 and £19,800 plus costs.
An example of a Lease Extension decision for a Rainham flat is 37 Lodge Court High Street in November 2013. the decision of the LVT was that the premium to be paid for the new lease was £25,559 This case was in relation to 1 flat. The unexpired term as at the valuation date was 57.5 years.