Unfortunately that a Oval residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the Oval property prices.Once your lease gets to 85ish years, you need to start thinking about a lease extension. If the number of years remaining drops below eighty years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property The majority of leasehold owners in Oval will be able to extend under the legislation; however a conveyancer should be able to clarify if you are eligibility. In some cases you may not qualify. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer throughout the formalities.
Leasehold properties in Oval with in excess of 100 years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Barclays plc | |
| Chelsea Building Society | |
| Royal Bank of Scotland | |
| Virgin | |
| Yorkshire Building Society |
The lawyers that we work with procure Oval 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 conveyancer we work with provide it.
David was the the leasehold owner of a studio flat in Oval on the market with a lease of fraction over 72 years left. David on an informal basis spoke with his freeholder a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a rise in the rent to £100 yearly. No ground rent would be payable on a lease extension were David to invoke his statutory right. David obtained expert advice and secured an acceptable deal informally and sell the property.
In 2013 we were called by Mr J Martin who, having acquired a recently refurbished apartment in Oval in July 2000. We are asked if we could shed any light on how much (roughly) premium would likely be for a 90 year lease extension. Comparative residencies in Oval with a long lease were in the region of £181,600. The mid-range ground rent payable was £55 billed annually. The lease ran out in 2078. Considering the 52 years as a residual term we approximated the compensation to the landlord for the lease extension to be within £30,400 and £35,200 exclusive of costs.
An example of a Lease Extension decision for a Oval premises is Ground Floor Flat 39 Bronsart Road in May 2010. Following a vesting order by West London County Court the Leasehold Valuation Tribunal concluded that the price to be paid for the extended lease of the premises was Thirteen Thousand Two hundred pounds (£13,200) in accordance with the valuation. The extended lease was granted for a term of 90 years from the expiry date of the Lease and at a peppercorn ground rent from the date of the vesting order. This case was in relation to 1 flat. The unexpired residue of the current lease was 74.77 years.