The re-sale value of a leasehold property in Chalk Farm is impacted by how many years the lease has remaining. If it is near to or fewer than 80 years you should expect problems on re-sale, so it is recommended to arrange for the lease to be extended ahead of purchasing. It is ideal to start the process of extending the lease is when a lease still has 82 years unexpired so that formalities can be concluded in advance of the eighty year mark. Leasehold Reform legislation enables Chalk Farm qualifying lessees to acquire a new lease which will be for the current unexpired lease term plus an additional term of ninety years. The purpose of the valuation is to determine the amount payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a residential leasehold with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further 90 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 undertake Chalk Farm 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.
Alfie owned a studio flat in Chalk Farm being marketed with a lease of a little over sixty years outstanding. Alfie informally approached his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of an increased rent to £200 per annum. Ordinarily, ground rent would not be payable on a lease extension were Alfie to exercise his statutory right. Alfie procured expert advice and was able to make a more informed judgement and deal with the matter and sell the flat.
Last Summer we were approach by Ms Amelia Khan , who acquired a studio apartment in Chalk Farm in July 1995. The dilemma was if we could approximate the premium could be for a ninety year extension to my lease. Identical properties in Chalk Farm with a long lease were in the region of £181,600. The average amount of ground rent was £55 invoiced quarterly. The lease end date was in 2077. Given that there were 52 years left we approximated the premium to the freeholder for the lease extension to be within £30,400 and £35,200 exclusive of costs.
An example of a Lease Extension matter before the tribunal for a Chalk Farm premises is Flat 2 27 Mackeson Road in December 2012. The Tribunal assessed the value of the lease extension premium at £35,435 and rounded the figure to £35,500 This case affected 1 flat. The unexpired term was 64.77 years.