New Eltham leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. It is the case that most New Eltham tenants have the right to extend their lease by an additional ninety years by virtue of the 1993 Leasehold Reform Act. Where you are a leasehold owner in New Eltham you really ought to check if your lease has between 70 and 90 years left. There are good reasons why a New Eltham flat owner with a lease having around eighty years remaining should take steps to ensure that a lease extension is actioned without delay
Leasehold properties in New Eltham with over one hundred years unexpired 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 property. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | |
| Bank of Scotland | |
| Birmingham Midshires | |
| Godiva Mortgages | |
| The Mortgage Works |
The conveyancing solicitors that we work with handle New Eltham 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.
Elijah owned a high value apartment in New Eltham on the market with a lease of fraction over sixty years outstanding. Elijah informally contacted his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent at the outset set at £200 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Elijah to exercise his statutory right. Elijah procured expert legal guidance and was able to make a more informed judgement and handle with the matter and readily saleable.
Last Autumn we were contacted by Dr R Morgan , who bought a first floor flat in New Eltham in May 2010. We are asked if we could approximate the price would be to prolong the lease by a further 90 years. Identical flats in New Eltham with 100 year plus lease were in the region of £174,200. The average ground rent payable was £55 invoiced annually. The lease termination date was on 25 March 2077. Having 51 years as a residual term we calculated the compensation to the landlord for the lease extension to be between £31,400 and £36,200 exclusive of expenses.
An example of a Lease Extension case for a New Eltham premises is 103a Footscray Road in January 2014. The tribunal determines that the premium payable for the extended lease should be £34,500 according to the expert witness valuation calculation This case was in relation to 1 flat.