Fitzrovia leases on residential properties are gradually losing value. Where your lease has in the region of ninety years left, you should start thinking about a lease extension. Eighty years is a significant number: when the remaining term of a lease falls below this level then you start incurring an additional element called marriage value. Flat owners in Fitzrovia will mostly be legally entitled to a lease extension; however it’s a good idea to check with a conveyancer to confirm your eligibility. In some situations you may not be entitled. There are also strict deadlines and formalities to follow once the process has started so it’s best to be guided by a conveyancer during the process.
It is conventional wisdom that a property with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years unexpired, the premises will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Retaining our service gives you better control over the value of your Fitzrovia leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Andrew was the the leasehold proprietor of a conversion apartment in Fitzrovia being sold with a lease of a few days over sixty years remaining. Andrew on an informal basis approached his freeholder being a well known Bristol-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent at the outset set at £100 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Andrew to invoke his statutory right. Andrew procured expert advice and was able to make a more informed decision and handle with the matter and ending up with a market value flat.
In 2014 we were approached by Mr and Mrs. L Ricardo who, having purchased a garden apartment in Fitzrovia in August 2004. The question was if we could estimate the price could be for a 90 year lease extension. Comparative properties in Fitzrovia with a long lease were worth £176,200. The average ground rent payable was £65 billed per annum. The lease ended on 16 October 2081. Taking into account 56 years outstanding we estimated the premium to the freeholder to extend the lease to be within £29,500 and £34,000 not including professional charges.
An example of a Freehold Enfranchisement matter before the tribunal for a Fitzrovia flat is 20 Avonwick Road in July 2013. The Tribunal was dealing with an application under Section 26 of the Leasehold Reform Housing and Urban Development Act 1993 for a determination of the freehold value of the property. It was concluded that the price to be paid was Fifteen Thousand Nine Hundred and Seventy (£15,970) divided as to £8,200 for Flat 20 and £7,770 for Flat 20A This case affected 1 flat. The unexpired lease term was 73.26 years.