Brighstone leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease gets more expensive. Legislation has been in place for sometime now which entitles qualifying Brighstone residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Brighstone you must see if your lease has between 70 and ninety years left. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension increases dramatically as part of the premium you pay is what is known as a marriage value
Leasehold properties in Brighstone with over 100 years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | |
| Barnsley Building Society | |
| Birmingham Midshires | |
| Leeds Building Society | |
| National Westminster Bank |
Regardless of whether you are a tenant or a landlord in Brighstone,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Brighstone valuers.
Ethan was the the leasehold owner of a studio apartment in Brighstone being sold with a lease of a little over 72 years left. Ethan on an informal basis approached his landlord being a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £50 per annum. No ground rent would be payable on a lease extension were Ethan to exercise his statutory right. Ethan procured expert legal guidance and was able to make a more informed decision and deal with the matter and ending up with a market value flat.
In 2009 we were approached by Dr Harrison Wood who, having moved into a one bedroom flat in Brighstone in September 2008. We are asked if we could approximate the compensation to the landlord would be to extend the lease by 90 years. Comparative premises in Brighstone with a long lease were in the region of £208,600. The mid-range amount of ground rent was £60 collected per annum. The lease terminated in 2083. Considering the 57 years remaining we calculated the premium to the landlord to extend the lease to be within £30,400 and £35,200 exclusive of legals.
In 2014 we were phoned by Ms O Gunderson who, having was assigned a lease of a ground floor flat in Brighstone in May 2005. We are asked if we could shed any light on how much (roughly) premium would likely be for a ninety year extension to my lease. Similar properties in Brighstone with a long lease were valued about £200,000. The average ground rent payable was £50 collected annually. The lease expired on 11 June 2103. Considering the 77 years as a residual term we approximated the compensation to the freeholder to extend the lease to be within £8,600 and £9,800 plus legals.