With a domestic leasehold property in Stratford, you are in fact renting it for a certain amount of time. These days flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you should think about a lease extension sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly notably when there are fewer than 80 years remaining. Anyone in Stratford with a lease drawing near to 81 years left should seriously consider extending it sooner rather than later. Once a lease has fewer than 80 years outstanding, under the current legislation the freeholder can calculate and charge a greater amount, assessed on a technical multiplication, strangely termed as “marriage value” which is payable.
Leasehold residencies in Stratford with over one hundred years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the freehold unless savings on ground rent and maintenance charges justify it.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service gives you increased control over the value of your Stratford leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Aaron owned a conversion apartment in Stratford on the market with a lease of fraction over 72 years left. Aaron informally approached his landlord being a well known London-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Aaron to invoke his statutory right. Aaron procured expert legal guidance and secured satisfactory deal informally and ending up with a market value flat.
Last Christmas we were called by Mr D Patel , who bought a garden apartment in Stratford in February 2010. We are asked if we could approximate the price could be for a ninety year lease extension. Comparable properties in Stratford with an extended lease were valued about £285,000. The mid-range ground rent payable was £55 collected annually. The lease ran out on 2 June 2105. Considering the 79 years outstanding we calculated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 exclusive of fees.
An example of a Freehold Enfranchisement case for a Stratford premises is 12 Nutfield Road in July 2014. the Tribunal judged that the price to be paid by the applicants for the freehold interest should be £19,572 This case related to 2 flats. The unexpired term as at the valuation date was 72.02 years.