Why you should start your Erdington lease extension

Why you should start your Erdington lease extension today:

A Erdington lease depreciates with the years remaining on the lease.

Unfortunately that a Erdington residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Erdington property prices.Where your lease has approximately ninety years left, you should start considering a lease extension. If lease term slips under 80 years, you will then be required to pay half of the property's 'marriage value' on top of 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 Erdington will be able to extend under the legislation; however a conveyancer will be able to confirm if you qualify for an extension. In some cases you may not be entitled. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your conveyancer for the duration of the process.

An extended lease has roughly the same value as a freehold

Leasehold properties in Erdington with in excess of 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and estate charges justify it.

Mortgage lenders may not grant a mortgage on a short lease

Many banks and building societies will not lend on a lease with under seventy years unexpired - although this varies between mortgage companies. A buyer will no doubt encounter difficulties to obtain a mortgage and this could result in your Erdington property becoming difficult to dispose of or to obtain finance on.

Get in touch with one of our Erdington lease extension solicitors or enfranchisement solicitors

Using our service gives you better control over the value of your Erdington leasehold, as your property will be more valuable and saleable in respect of lease length should you wish to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.

Erdington Lease Extension Example Cases:

Daniel, Erdington, Birmingham

In recent months Daniel, started to get near to the 80-year threshold with the lease on his two bedroom apartment in Erdington. Having purchased his flat two decades ago, the unexpired term was of no concern. Luckily, he noticed he would soon be paying way over the odds for a lease extension. Daniel was able to extend his lease just in the nick of time in September. Daniel and the landlord eventually agreed on a premium of £5,500 . If the lease had slid lower than 80 years, the premium would have become more costly by at least £1,100.

Erdington case:

In 2010 we were contacted by Ms Megan Girard who, having took over the lease of a newly refurbished flat in Erdington in March 2002. We are asked if we could estimate the price would be to prolong the lease by a further 90 years. Comparative homes in Erdington with an extended lease were valued about £254,200. The mid-range ground rent payable was £60 collected every twelve months. The lease expired in 2077. Having 51 years left we calculated the compensation to the freeholder to extend the lease to be within £43,700 and £50,600 not including professional charges.

Erdington case:

Last Summer we were contacted by Dr Louise Martin , who acquired a ground floor flat in Erdington in August 2012. The dilemma was if we could approximate the price could be for a ninety year lease extension. Comparative properties in Erdington with 100 year plus lease were in the region of £210,600. The mid-range amount of ground rent was £45 invoiced per annum. The lease lapsed on 5 November 2088. Considering the 62 years remaining we approximated the compensation to the freeholder for the lease extension to be between £18,100 and £20,800 plus legals.