With a residential leasehold property in Shadwell, you are actually buying a right to reside in a property for a prescribed time frame. Modern 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 extending the lease sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly notably when there are fewer than 80 years remaining. Leasehold owners in Shadwell with a lease drawing near to 81 years unexpired should seriously consider extending it sooner than later. Once the lease term has under 80 years left, under the current statute the freeholder can calculate and demand a greater amount, assessed on a technical calculation, known as “marriage value” which is payable.
It is conventional wisdom that a property with over 100 years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years unexpired, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
The lawyers that we work with handle Shadwell 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 lawyer we work with provide it.
Logan was the the leasehold proprietor of a high value apartment in Shadwell being sold with a lease of a little over fifty eight years outstanding. Logan on an informal basis spoke with his landlord a well known Bristol-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent initially set at £100 per annum and doubled every 25 years thereafter. No ground rent would be due on a lease extension were Logan to exercise his statutory right. Logan procured expert advice and was able to make a more informed judgement and deal with the matter and readily saleable.
Last Autumn we were called by Mrs S Hernández , who moved into a one bedroom apartment in Shadwell in September 1998. The dilemma was if we could approximate the premium could be for a ninety year lease extension. Similar premises in Shadwell with 100 year plus lease were worth £191,400. The average ground rent payable was £55 billed monthly. The lease terminated on 14 August 2080. Taking into account 54 years unexpired we approximated the premium to the freeholder for the lease extension to be between £34,200 and £39,600 plus costs.
An example of a Freehold Enfranchisement matter before the tribunal for a Shadwell property is 12, 14 & 16 Hull Close in May 2010. the Tribunal determined that the premium payable for the acquisition of the freehold to the subject premises was the sum of £18,300 This case related to 3 flats. The unexpired residue of the current lease was 101.61 years.