When it comes to residential leasehold premises in Croydon, you are actually purchasing an entitlement to reside in a property for a prescribed time frame. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you should think about extending the lease sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly particularly when there are less than 80 years left. Anyone in Croydon with a lease approaching 81 years left should seriously consider extending it without delay. Once a lease has under 80 years outstanding, under the relevant legislation the freeholder can calculate and demand a larger premium, based on a technical calculation, known as “marriage value” which is due.
It is generally accepted that a property with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years left, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Regardless of whether you are a tenant or a landlord in Croydon,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 Croydon valuers.
In recent months Edward, came dangerously near to the 80-year mark with the lease on his leasehold apartment in Croydon. In buying his home 18 years ago, the length of the lease was of minimal significance. As luck would have it, he noticed he would imminently be paying an inflated amount for a lease extension. Edward extended the lease at the eleventh hour in May. Edward and the freeholder via the managing agents eventually settled on sum of £6,000 . If he had missed the deadline, the sum would have gone up by at least £1,075.
In 2009 we were contacted by Mr Eliot González who, having completed a purpose-built apartment in Croydon in August 2007. We are asked if we could shed any light on how much (approximately) premium would be for a 90 year extension to my lease. Similar residencies in Croydon with an extended lease were valued about £200,000. The mid-range ground rent payable was £50 collected every twelve months. The lease ran out on 8 August 2102. Taking into account 77 years unexpired we approximated the premium to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of fees.
An example of a Freehold Enfranchisement case for a Croydon property is 29 Woodstock Road in April 2014. the Tribunal determined that the premiums to be paid into court in respect of the purchase of the freehold registered at HMLR under Title N0.SY3997 should be £7,217. This case was in relation to 4 flats. The unexpired term as at the valuation date was 98 years.