When it comes to domestic leasehold property in Merton Park, you are actually purchasing an entitlement to reside in a property for a set period of time. These days flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you may think about a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly especially once there are less than eighty years left. Residents in Merton Park with a lease drawing near to 81 years unexpired should seriously consider extending it without delay. When the lease term has less than eighty years left, under the relevant legislation the landlord is entitled to calculate and charge a larger amount, based on a technical calculation, strangely termed as “marriage value” which is due.
It is conventional wisdom that a property with over 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Irrespective of whether you are a tenant or a freeholder in Merton Park,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Merton Park valuers.
Last October Callum, started to get near to the eighty-year threshold with the lease on his first floor apartment in Merton Park. In buying his property two decades ago, the length of the lease was of little significance. Thankfully, he became aware that he needed to take action soon on a lease extension. Callum extended the lease just under the wire last March. Callum and the freeholder via the management company ultimately settled on sum of £5,000 . If the lease had gone below 80 years, the sum would have become more exhorbitant by at least £1,075.
Mr and Mrs. E Peterson bought a studio flat in Merton Park in May 2006. The dilemma was if we could shed any light on how much (roughly) price would likely be to extend the lease by 90 years. Identical properties in Merton Park with 100 year plus lease were in the region of £260,200. The average ground rent payable was £65 collected monthly. The lease terminated on 8 August 2091. Considering the 66 years remaining we approximated the compensation to the freeholder to extend the lease to be between £15,200 and £17,600 not including expenses.
An example of a Lease Extension decision for a Merton Park premises is 14 Nutwell Street in January 2014. The premium payable for the acquisition of a new lease of the subject premises was in the sum of £30,523 This case affected 1 flat. The unexpired term as at the valuation date was 62.94 years.