As the length of the unexpired term of a Bethnal Green residential lease diminished so does its value and therefore the value of your property. Where the residual term has, more than 125 years remaining then this decrease may be of little impact that being said there will become a stage when a lease has fewer than eighty years remaining 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 consider extending without delay. Most flat owners in Bethnal Green will qualify for this right; nevertheless a conveyancer will be able to advise if you are eligible to extend your lease. In limited situations you may not qualify, the most frequent 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 roughly the same as a freehold. Where an additional 90 years added to any lease with more than 30 years unexpired, the residence will be equivalent in value to a freehold for many years ahead.
| 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Bethnal Green,the lease extension experts 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 Bethnal Green valuers.
Last year Evan, came very close to the eighty-year mark with the lease on his purpose- built apartment in Bethnal Green. In buying his home 19 years previously, the length of the lease was of minimal importance. As luck would have it, he realised he would imminently be paying an inflated amount for a lease extension. Evan extended the lease at the eleventh hour in May. Evan and the freeholder eventually agreed on sum of £5,500 . If the lease had dipped to less than eighty years, the price would have escalated by a minimum £1,150.
In 2012 we were e-mailed by Mr M Gunderson who, having owned a one bedroom flat in Bethnal Green in July 2001. The question was if we could approximate the premium would likely be to extend the lease by a further 90 years. Similar premises in Bethnal Green with 100 year plus lease were valued around £290,000. The mid-range amount of ground rent was £45 collected yearly. The lease ran out in 2098. Considering the 72 years as a residual term we calculated the premium to the landlord for the lease extension to be between £11,400 and £13,200 not including professional charges.
An example of a Lease Extension decision for a Bethnal Green 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 affected 2 flats. The unexpired term was 72.39 years.