March leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. It is the case that most March 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 March you really ought to see if your lease has between 70 and ninety years remaining. There are good reasons why a March leaseholder with a lease having around 80 years remaining should take action to make sure that a lease extension is effected without delay
Leasehold premises in March with over 100 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 situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges merit it.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | 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. |
Engaging our service gives you enhanced control over the value of your March leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In the wake of 6 months of protracted negotiations with the freeholder of her purpose-built apartment in March, Tia initiated the lease extension process as the eighty year threshold was swiftly nearing. The lease extension was concluded in November 2015. The landlord’s costs were kept to an absolute minimum.
Last Winter we were e-mailed by Mr and Mrs. E Díaz , who took over the lease of a newly refurbished flat in March in June 1999. We are asked if we could approximate the price could be for a ninety year extension to my lease. Similar premises in March with a long lease were in the region of £174,200. The mid-range ground rent payable was £55 billed yearly. The lease terminated on 16 March 2076. Taking into account 51 years outstanding we estimated the compensation to the freeholder to extend the lease to be between £31,400 and £36,200 not including professional charges.
In 2010 we were called by Mr and Mrs. Y Michel who, having took over the lease of a garden apartment in March in July 2007. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be for a 90 year lease extension. Comparable homes in March with 100 year plus lease were in the region of £285,000. The mid-range ground rent payable was £45 collected yearly. The lease expired on 18 May 2096. Considering the 71 years outstanding we estimated the premium to the landlord for the lease extension to be between £12,400 and £14,200 plus professional charges.