With a domestic leasehold premises in Kingston, you are in fact renting it for a certain period of time. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you may think about extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease becomes disproportionately more expensive especially once there are fewer than eighty years remaining. Leasehold owners in Kingston with a lease approaching 81 years unexpired should seriously consider extending it sooner rather than later. When the lease term has fewer than eighty years left, under the current legislation the freeholder can calculate and levy a larger premium, based on a technical multiplication, strangely termed as “marriage value” which is payable.
Leasehold properties in Kingston with over one hundred years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
The conveyancers that we work with procure Kingston 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.
In 2014 Milo, came dangerously near to the 80-year threshold with the lease on his garden apartment in Kingston. In buying his property two decades ago, the lease term was of no relevance. Luckily, it dawned on him that he would soon be paying an escalated premium for Extending the lease. Milo extended the lease at the eleventh hour in July. Milo and the freeholder in the end agreed on an amount of £6,000 . If the lease had dropped below eighty years, the price would have escalated by a minimum £975.
Mr and Mrs. U Moore completed a first floor flat in Kingston in July 1996. The question was if we could estimate the premium would be for a ninety year extension to my lease. Identical residencies in Kingston with 100 year plus lease were worth £265,000. The mid-range amount of ground rent was £50 collected every twelve months. The lease finished in 2099. Given that there were 74 years unexpired we estimated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of costs.
In 2012 we were called by Mrs V White who, having owned a studio flat in Kingston in July 2007. We are asked if we could approximate the price would likely be to prolong the lease by 90 years. Identical premises in Kingston with an extended lease were valued around £166,400. The average ground rent payable was £60 collected monthly. The lease ran out on 12 April 2079. Taking into account 54 years outstanding we estimated the compensation to the freeholder to extend the lease to be between £32,300 and £37,400 exclusive of legals.