Marchington 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 your lease gets more expensive. It is the case that most Marchington tenants have the right to extend their lease by an additional ninety years in accordance with the 1993 Leasehold Reform Act. Where you are a leasehold owner in Marchington you should see if your lease has between 70 and ninety years remaining. There are compelling reasons why a Marchington flat owner with a lease having around eighty years unexpired should take action to make sure that a lease extension is actioned without delay
It is generally considered that a property with in excess of one hundred years remaining is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| 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 |
Irrespective of whether you are a tenant or a freeholder in Marchington,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Marchington valuers.
Off the back of protracted discussions with the freeholder of her one bedroom flat in Marchington, Melissa initiated the lease extension process as the 80 year deadline was rapidly approaching. The transaction was concluded in June 2008. The freeholder’s costs were negotiated to a tad over 600 pounds.
Ms Ashleigh King took over the lease of a garden flat in Marchington in November 2004. We are asked if we could estimate the compensation to the landlord could be for a 90 year lease extension. Comparable flats in Marchington with 100 year plus lease were valued about £205,000. The mid-range amount of ground rent was £50 collected quarterly. The lease concluded in 2104. Considering the 79 years outstanding we estimated the compensation to the landlord for the lease extension to be between £8,600 and £9,800 plus expenses.
Last August we were phoned by Dr Ali Norbert , who bought a ground floor flat in Marchington in September 2006. The dilemma was if we could estimate the premium would be to prolong the lease by ninety years. Comparable homes in Marchington with 100 year plus lease were worth £275,000. The mid-range amount of ground rent was £65 billed per annum. The lease lapsed on 4 September 2093. Considering the 68 years left we estimated the premium to the landlord for the lease extension to be within £12,400 and £14,200 not including legals.