As the the remaining lease term of a Barbican domestic lease diminished so does its value and therefore the value of your property. If the lease has, more than 100 years to run then this decrease may be fractional that being said there will become a point in time when a lease has under than 80 years left as part of the premium you will incur is what is known as a marriage value. This could increase sharply the cost. It is the main rational as to why you should extend the lease sooner as opposed to later. Most flat owners in Barbican will qualify for this right; that being said a conveyancer should be able to advise if you are eligible to extend your lease. In certain situations you may not qualify, the most common reason being that you have owned the property for under two years.
It is conventional wisdom that a residential leasehold with more than one hundred years remaining is worth approximately the same 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.
|Bank of Scotland||Minimum 70 years from the date of the mortgage.|
|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.|
|Halifax||Minimum 70 years from the date 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
Irrespective of whether you are a tenant or a landlord in Barbican,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Barbican valuers.
Two years ago Ollie, started to get near to the eighty-year threshold with the lease on his one bedroom apartment in Barbican. In buying his flat 18 years previously, the length of the lease was of no importance. As luck would have it, he recognised he needed to take action soon on a lease extension. Ollie arranged for a lease extension just under the wire last January. Ollie and the freeholder subsequently agreed on the final figure of £5,000 . If the lease had dipped lower than eighty years, the premium would have increased by at least £1,100.
In 2013 we were phoned by Ms Amber Phillips who, having purchased a recently refurbished flat in Barbican in March 2009. The question was if we could shed any light on how much (approximately) compensation to the landlord would be for a ninety year extension to my lease. Comparable flats in Barbican with 100 year plus lease were in the region of £245,000. The mid-range ground rent payable was £50 billed every twelve months. The lease expired on 6 September 2091. Given that there were 68 years remaining we approximated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 not including costs.
An example of a Lease Extension matter before the tribunal for a Barbican premises is 137 & 139 Haberdasher Street in December 2013. The Tribunal determines in accordance with section 48 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 that the premium for the extended lease for each Property should be £12,350.00. This case was in relation to 2 flats. The remaining number of years on the lease was 72.39 years.