Covent Garden leases on residential deteriorating in value. if your lease has in the region of ninety years unexpired, you should start thinking about a lease extension. If lease term falls under 80 years, you will then have to pay half of the property's 'marriage value' on top of the standard cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Flat owners in Covent Garden will usually be legally entitled to a lease extension; however it’s a good idea to check with a lawyer to confirm if you qualify. In certain situations you may not qualify. There are also strict timetables and formalities to comply with once the process has started so it’s prudent to be guided by a conveyancing solicitor during the process.
It is conventional wisdom that a residential leasehold with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a landlord in Covent Garden,the lease extension solicitors 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 Covent Garden valuers.
Zachary owned a high value apartment in Covent Garden being sold with a lease of fraction over sixty years left. Zachary on an informal basis contacted his landlord a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent to start with set at £150 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Zachary to invoke his statutory right. Zachary procured expert advice and was able to make an informed decision and handle with the matter and readily saleable.
In 2012 we were approached by Dr Jasper Clark who, having was assigned a lease of a purpose-built flat in Covent Garden in August 1997. The dilemma was if we could estimate the price would likely be to prolong the lease by an additional years. Comparative residencies in Covent Garden with an extended lease were valued around £176,200. The mid-range ground rent payable was £65 invoiced annually. The lease lapsed on 9 October 2082. Considering the 56 years left we approximated the premium to the freeholder to extend the lease to be within £29,500 and £34,000 exclusive of expenses.
An example of a Freehold Enfranchisement decision for a Covent Garden property is 20 Avonwick Road in July 2013. The Tribunal was dealing with an application under Section 26 of the Leasehold Reform Housing and Urban Development Act 1993 for a determination of the freehold value of the property. It was concluded that the price to be paid was Fifteen Thousand Nine Hundred and Seventy (£15,970) divided as to £8,200 for Flat 20 and £7,770 for Flat 20A This case was in relation to 1 flat. The unexpired lease term was 73.26 years.