There is no doubt about it a leasehold flat or house in Ladywell is a wasting asset as a result of the shortening lease. Where the residual term has, more than 99 years to run then this decrease may be fractional nevertheless there will become a point in time when a lease has fewer than 80 years unexpired as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the main rational as to why you should extend the lease sooner rather than later. Most flat owners in Ladywell will meet the qualifying criteria; that being said a conveyancing solicitor should be able to advise if you are eligible for a lease extension. In certain situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
Leasehold premises in Ladywell with over 100 years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges justify it.
| 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers 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 conveyancing solicitor we work with provide it.
18 months ago Oscar, started to get near to the eighty-year mark with the lease on his garden flat in Ladywell. In buying his property two decades ago, the lease term was of minimal importance. As luck would have it, he realised he would soon be paying an inflated amount for a lease extension. Oscar extended the lease just under the wire last August. Oscar and the freeholder via the managing agents ultimately agreed on an amount of £5,500 . If the lease had dipped to less than eighty years, the premium would have increased by at least £975.
In 2013 we were called by Dr Tia Brown who, having was assigned a lease of a studio apartment in Ladywell in September 2001. We are asked if we could approximate the price would be to extend the lease by 90 years. Comparable residencies in Ladywell with 100 year plus lease were in the region of £200,800. The mid-range amount of ground rent was £65 collected per annum. The lease terminated on 25 February 2086. Given that there were 60 years outstanding we estimated the compensation to the freeholder to extend the lease to be between £20,900 and £24,200 exclusive of legals.
An example of a Freehold Enfranchisement matter before the tribunal 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 was in relation to 2 flats. The unexpired term was 74.25 years.