It’s an underpublicised truth that a Crofton residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the Crofton property market.Where your lease has approximately ninety years left, you need to start considering a lease extension. If the number of years remaining dips under 80 years, you will end up paying 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 flat owners in Crofton will be able to extend under the legislation; however a lawyer will be able to clarify 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 has commenced and you will need to be guided by your lawyer from beginning to end of the process.
It is conventional wisdom that a property with more than 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barclays plc | |
| Chelsea Building Society | |
| Godiva Mortgages | |
| Leeds Building Society | |
| TSB |
Irrespective of whether you are a tenant or a freeholder in Crofton,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Crofton valuers.
Ryan owned a 2 bedroom flat in Crofton being sold with a lease of fraction over 59 years left. Ryan on an informal basis spoke with his landlord being a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a new rent initially set at £200 per annum and increase every 25 years thereafter. No ground rent would be payable on a lease extension were Ryan to exercise his statutory right. Ryan procured expert legal guidance and secured satisfactory resolution informally and ending up with a market value flat.
In 2014 we were called by Dr Mollie James who, having took over the lease of a one bedroom flat in Crofton in March 2010. We are asked if we could shed any light on how much (approximately) compensation to the landlord could be to extend the lease by an additional years. Comparable properties in Crofton with 100 year plus lease were in the region of £200,800. The mid-range ground rent payable was £65 collected annually. The lease lapsed in 2086. Taking into account 60 years left we calculated the compensation to the landlord for the lease extension to be between £20,900 and £24,200 not including fees.
Last Spring we were approach by Mr and Mrs. M Dupont , who acquired a one bedroom flat in Crofton in February 2003. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be for a ninety year lease extension. Identical properties in Crofton with 100 year plus lease were valued around £255,000. The mid-range ground rent payable was £50 collected quarterly. The lease terminated on 3 June 2097. Taking into account 71 years remaining we estimated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 not including expenses.