Downham leases on residential deteriorating in value. Where your lease has approximately ninety years left, you should start thinking about a lease extension. Eighty years is a significant number: when the unexpired term of a lease falls below this level then you start incurring an additional element called marriage value. Leasehold owners in Downham will usually qualify for a lease extension; however It would be wise to check with a lawyer to confirm your eligibility. In certain situations you may not be entitled. There are also strict timetables and steps to follow once the process has commenced so it’s prudent to be guided by a lawyer during the process.
Leasehold properties in Downham with more than 100 years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with undertake Downham lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Nathaniel owned a high value flat in Downham being sold with a lease of just over 72 years left. Nathaniel informally contacted his landlord a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent at the outset set at £150 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Nathaniel to exercise his statutory right. Nathaniel procured expert advice and was able to make an informed decision and deal with the matter and readily saleable.
Last year we were e-mailed by Ms Elizabeth Patel , who bought a one bedroom apartment in Downham in September 2007. We are asked if we could estimate the premium would be for a ninety year lease extension. Identical premises in Downham with an extended lease were in the region of £200,000. The mid-range amount of ground rent was £50 invoiced monthly. The lease ended in 2102. Considering the 77 years left we estimated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 plus costs.
An example of a Freehold Enfranchisement decision for a Downham residence is Ravensbourne Lodge 4 Highland Road in February 2013. the Tribunal held that the amount payable for the freehold was £22,268