Unfortunately that a Bethnal Green residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Bethnal Green property prices.Once your lease gets to 85ish years, you need to start thinking about a lease extension. If the number of years remaining dips below 80 years, you will then be required to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property The majority of flat owners in Bethnal Green will be able to extend under the legislation; however a lawyer will be able to confirm if you are eligibility. In some cases you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process is instigated and you will need to be guided by your lawyer from beginning to end of the formalities.
It is generally considered that a residential leasehold with more than 100 years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Engaging our service will provide you better 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 wish to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
In 2014 Owen, started to get close to the eighty-year mark with the lease on his two bedroom flat in Bethnal Green. Having purchased his flat twenty years ago, the unexpired term was of no bearing. Fortunately, he noticed he needed to take steps soon on a lease extension. Owen was able to extend his lease just under the wire in April. Owen and the freeholder ultimately settled on a premium of £5,000 . If the lease had dipped to less than 80 years, the sum would have gone up by a minimum £975.
Last July we were phoned by Mr and Mrs. H Michel , who purchased a basement flat in Bethnal Green in February 1996. The dilemma was if we could estimate the compensation to the landlord would be to prolong the lease by an additional years. Similar residencies in Bethnal Green with an extended lease were valued around £267,600. The average amount of ground rent was £65 billed annually. The lease elapsed on 23 May 2093. Taking into account 67 years unexpired we estimated the compensation to the landlord to extend the lease to be within £14,300 and £16,400 exclusive of fees.
An example of a Lease Extension matter before the tribunal 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 was in relation to 2 flats. The number of years remaining on the existing lease(s) was 72.39 years.