Unfortunately that a Fitzrovia residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the Fitzrovia property market.Once your lease nears 85ish years, you should start considering a lease extension. If the number of years remaining drops under eighty years, you will then be required to pay 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property The majority of leasehold owners in Fitzrovia will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm if you are eligibility. In some cases you may not be entitled. There are also strict timetables and procedures to follow once the process is instigated and you will need to be guided by your lawyer throughout the formalities.
Leasehold properties in Fitzrovia with in excess of one hundred years left on the lease are sometimes referred to as ‘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 buying the reversionary interest unless savings on ground rent and maintenance charges justify it.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Irrespective of whether you are a tenant or a freeholder in Fitzrovia,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Fitzrovia valuers.
After protracted negotiations with the freeholder of her leasehold flat in Fitzrovia, Sophia initiated the lease extension process just as the lease was approaching the all-important eighty-year deadline. The legal work was concluded in January 2010. The landlord’s costs were negotiated to a tad over five hundred GBP.
In 2012 we were phoned by Dr Maisie Bernard who, having acquired a studio apartment in Fitzrovia in October 2007. The question was if we could shed any light on how much (roughly) price would likely be to prolong the lease by 90 years. Identical residencies in Fitzrovia with a long lease were in the region of £250,000. The average ground rent payable was £50 collected per annum. The lease finished on 28 September 2095. Having 69 years remaining we approximated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 exclusive of expenses.
An example of a Freehold Enfranchisement decision for a Fitzrovia property 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 related to 1 flat. The unexpired lease term was 73.26 years.