When it comes to residential leasehold property in Croydon, you effectively rent it for a certain period of time. In recent years flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you may think about extending the lease sooner rather than later. The general rule is that the shorter the number of years is the cost of extending the lease becomes disproportionately greater notably once there are fewer than eighty years remaining. Anyone in Croydon with a lease nearing 81 years left should seriously think of extending it as soon as possible. When a lease has below 80 years outstanding, under the relevant statute the landlord can calculate and levy a greater amount, based on a technical calculation, strangely termed as “marriage value” which is payable.
It is generally considered that a residential leasehold with more than 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
| 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. |
Lease extensions in Croydon can be a difficult process. We recommend you get guidance from a conveyancer and surveyor with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Croydon lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Toby owned a high value flat in Croydon being marketed with a lease of a few days over 59 years left. Toby on an informal basis contacted his freeholder a well known local-based freehold company for a lease extension. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent initially set at £150 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Toby to exercise his statutory right. Toby obtained expert legal guidance and secured an acceptable resolution without resorting to tribunal and readily saleable.
Last September we were contacted by Dr V Morel , who purchased a studio flat in Croydon in February 2008. The dilemma was if we could approximate the premium would be to extend the lease by an additional years. Comparable premises in Croydon with an extended lease were in the region of £275,000. The mid-range ground rent payable was £65 collected per annum. The lease terminated on 9 July 2094. Considering the 68 years outstanding we calculated the premium to the freeholder to extend the lease to be within £12,400 and £14,200 plus expenses.
An example of a Freehold Enfranchisement decision for a Croydon residence 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 related to 4 flats. The unexpired term was 98 years.