It’s an underpublicised truth that a Ironbridge residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the loss of value being disguised by increases in the Ironbridge property market.Where your lease has approximately 90 years left, you need to start thinking about a lease extension. If the number of years remaining falls below eighty years, you will end up paying half of the property's 'marriage value' in addition to 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 flat owners in Ironbridge will be able to extend under the legislation; however a conveyancer will be able to clarify if you are eligibility. In some cases you may not qualify. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer for the duration of the formalities.
It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| Yorkshire 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. |
Lease extensions in Ironbridge can be a difficult process. We recommend you secure professional help from a conveyancer and valuer with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring Ironbridge lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last Summer Samuel, came precariously close to the 80-year mark with the lease on his studio flat in Ironbridge. In buying his property 18 years previously, the lease term was of no bearing. Fortunately, it dawned on him that he needed to take action soon on a lease extension. Samuel extended the lease at the eleventh hour in September. Samuel and the freeholder eventually agreed on the final figure of £5,000 . If he had missed the deadline, the amount would have gone up by a minimum £1,025.
Last year we were approach by Mr L Petit , who was assigned a lease of a first floor apartment in Ironbridge in April 1995. We are asked if we could estimate the price could be to prolong the lease by an additional years. Identical premises in Ironbridge with 100 year plus lease were worth £275,000. The mid-range ground rent payable was £55 billed every twelve months. The lease came to a finish in 2103. Considering the 77 years as a residual term we approximated the premium to the landlord for the lease extension to be within £13,300 and £15,400 exclusive of fees.
Last Summer we were e-mailed by Dr M Bailey , who took over the lease of a studio apartment in Ironbridge in July 2012. We are asked if we could estimate the premium could be to prolong the lease by a further 90 years. Comparative premises in Ironbridge with an extended lease were worth £183,600. The mid-range ground rent payable was £65 billed quarterly. The lease ended in 2083. Considering the 57 years as a residual term we estimated the compensation to the landlord to extend the lease to be within £28,500 and £33,000 plus legals.