There is no doubt about it a leasehold property in Bethnal Green is a wasting asset as a result of the diminishing lease term. If the residual term has, beyond 99 years to run then this decrease may be negligible nevertheless there will become a point in time when a lease has less than 80 years left as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the primary logic behind why you should consider extending sooner as opposed to later. Many flat owners in Bethnal Green will meet the qualifying criteria; nevertheless a conveyancer will be able to confirm whether you qualify to extend your lease. In certain situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
It is generally accepted that a property with more than 100 years remaining is worth approximately 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 in the future.
| 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. |
| Lloyds TSB Scotland | 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Retaining our service will provide you increased control over the value of your Bethnal Green leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Last October Omar, came precariously close to the 80-year threshold with the lease on his ground floor flat in Bethnal Green. Having purchased his flat two decades ago, the lease term was of no importance. Luckily, he recognised he needed to take action soon on Extending the lease. Omar extended the lease just under the wire last January. Omar and the landlord who owned the flat above subsequently agreed on sum of £5,500 . If the lease had dipped lower than eighty years, the price would have escalated by a minimum £1,025.
Ms Danielle Lee was assigned a lease of a studio flat in Bethnal Green in March 2011. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be to prolong the lease by an additional years. Identical flats in Bethnal Green with an extended lease were valued about £257,800. The mid-range ground rent payable was £65 billed annually. The lease came to a finish on 18 September 2090. Taking into account 65 years as a residual term we estimated the compensation to the landlord to extend the lease to be between £18,100 and £20,800 exclusive of expenses.
An example of a Lease Extension matter before the tribunal for a Bethnal Green flat 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 related to 2 flats. The unexpired term as at the valuation date was 72.39 years.