It’s a harsh certainty that a Brockley residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Brockley property market.Once your lease gets to 85ish years, you should start thinking about a lease extension. If the number of years remaining falls below 80 years, you will then be required to pay half of the property's 'marriage value' in addition to 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 Most leasehold owners in Brockley will be able to extend under the legislation; however a conveyancer should be able to confirm if you are eligibility. In some situations you may not qualify. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer for the duration of the process.
Leasehold residencies in Brockley with in excess of 100 years outstanding 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 premises. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
The lawyers that we work with procure Brockley lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancer we work with provide it.
Jackson was the the leasehold proprietor of a 2 bedroom flat in Brockley being sold with a lease of a little over 61 years unexpired. Jackson 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 grant an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £100 annually. No ground rent would be due on a lease extension were Jackson to invoke his statutory right. Jackson procured expert legal guidance and secured satisfactory deal informally and readily saleable.
In 2009 we were contacted by Mr T Hall who, having bought a one bedroom flat in Brockley in February 2001. The question was if we could estimate the premium would be for a ninety year lease extension. Similar properties in Brockley with an extended lease were worth £200,800. The average amount of ground rent was £65 billed quarterly. The lease terminated on 4 April 2086. Taking into account 60 years left we estimated the compensation to the freeholder to extend the lease to be within £20,900 and £24,200 not including costs.
An example of a Lease Extension case for a Brockley property is Flat b 14 Kemble Road in May 2014. The Tribunal assessed the value of the premium payable for the lease extension to be £9,761 This case was in relation to 1 flat.