There is no doubt about it a leasehold property in Downe is a wasting asset as a result of the shortening lease. If the lease has, in excess of 99 years remaining then this decrease may be of little impact that being said there will become a point in time when a lease has fewer than 80 years unexpired as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the primary logic behind why you should consider extending sooner rather than later. Most flat owners in Downe will qualify for this right; nevertheless a conveyancing solicitor will be able to advise if you are eligible for a lease extension. In limited situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
It is conventional wisdom that a residential leasehold with over one hundred years remaining is worth approximately the equivalent 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 decades to come.
| 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. |
| Coventry Building Society | 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Regardless of whether you are a tenant or a freeholder in Downe,the lease extension experts 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 Downe valuers.
Edward was the the leasehold owner of a studio apartment in Downe being sold with a lease of fraction over sixty years outstanding. Edward on an informal basis approached his landlord being a well known local-based freehold company for a lease extension. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £125 per annum. No ground rent would be due on a lease extension were Edward to exercise his statutory right. Edward obtained expert advice and was able to make an informed judgement and handle with the matter and sell the flat.
Mr and Mrs. B Hernández acquired a first floor flat in Downe in August 2002. We are asked if we could approximate the compensation to the landlord would likely be to prolong the lease by ninety years. Comparable residencies in Downe with an extended lease were worth £280,000. The average ground rent payable was £45 billed per annum. The lease ran out in 2096. Given that there were 70 years left we calculated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of professional charges.
An example of a Lease Extension matter before the tribunal for a Downe property is 1 Southlands Court Southlands Road in September 2013. The Leasehold Valuation Tribunal determined that the premium to be paid by the tenant on the grant of a new lease, in accordance with section 56 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 was £30,541 This case affected 1 flat. The unexpired term was 50.57 years.