Market Drayton 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 Market Drayton tenants have the right to extend their lease by an additional ninety years in accordance with the 1993 Leasehold Reform Act. If you are a leasehold owner in Market Drayton you really ought to check if your lease has between 70 and 90 years left. In particular once the remaining lease term slips under eighty years, the compensation to the landlord for any lease extension increases dramatically as an element of the premium you pay is what is known as a marriage value
It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years remaining, the premises 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Yorkshire 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. |
Irrespective of whether you are a tenant or a freeholder in Market Drayton,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Market Drayton valuers.
Two years ago Zachary, came critically close to the 80-year mark with the lease on his one bedroom flat in Market Drayton. In buying his flat two decades ago, the lease term was of no importance. Luckily, it dawned on him that he would imminently be paying an inflated amount for a lease extension. Zachary was able to extend his lease just under the wire last January. Zachary and the freeholder eventually settled on sum of £5,000 . If he had missed the deadline, the premium would have gone up by a minimum £1,000.
Last Autumn we were e-mailed by Mr Callum López , who took over the lease of a newly refurbished flat in Market Drayton in September 2003. The question was if we could shed any light on how much (approximately) premium would likely be for a ninety year extension to my lease. Identical flats in Market Drayton with an extended lease were worth £223,400. The mid-range amount of ground rent was £60 billed monthly. The lease elapsed in 2085. Having 59 years remaining we estimated the premium to the freeholder for the lease extension to be between £27,600 and £31,800 plus expenses.
In 2010 we were approached by Mr and Mrs. C Peterson who, having was assigned a lease of a basement apartment in Market Drayton in June 2000. We are asked if we could approximate the compensation to the landlord would likely be for a ninety year extension to my lease. Similar premises in Market Drayton with 100 year plus lease were worth £205,000. The average amount of ground rent was £50 collected monthly. The lease terminated on 4 January 2105. Taking into account 79 years outstanding we estimated the premium to the landlord for the lease extension to be within £8,600 and £9,800 not including expenses.