Ladywell leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. It is the case that most Ladywell tenants have the right to extend their lease by an additional ninety years under the 1993 Leasehold Reform Act. If you are a leasehold owner in Ladywell you would be well advised to check if your lease has between seventy and 90 years left. In particular once the remaining lease term slips under 80 years, the amount payable for any lease extension sharply increases as part of the premium you pay is what is known as a marriage value
It is generally considered that a residential leasehold with over one hundred years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the property 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with undertake Ladywell 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.
Jake was the the leasehold proprietor of a conversion flat in Ladywell on the market with a lease of fraction over fifty eight years outstanding. Jake on an informal basis approached his landlord being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £125 annually. Ordinarily, ground rent would not be payable on a lease extension were Jake to exercise his statutory right. Jake procured expert advice and was able to make a more informed decision and handle with the matter and sell the flat.
Mr O Baker moved into a ground floor apartment in Ladywell in October 2002. We are asked if we could estimate the price could be for a 90 year extension to my lease. Similar properties in Ladywell with an extended lease were worth £265,000. The mid-range ground rent payable was £50 invoiced yearly. The lease concluded on 22 February 2098. Taking into account 73 years unexpired we approximated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 plus professional charges.
An example of a Freehold Enfranchisement case for a Ladywell premises is 44 Elmer Road in January 2013. The Tribunal dacied that amount to be paid by the Leaseholders for the Landlords freehold reversion was £12,951 as at the valuation date (20" September 2012).This matter was referred back to the Bromley County Court to deal with costs, fees and any other outstanding matters. This case affected 2 flats. The number of years remaining on the existing lease(s) was 74.25 years.