Park Royal leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Park Royal residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Park Royal you really ought to see if your lease has between seventy and 90 years left. In particular once the remaining lease term slips under 80 years, the compensation to the landlord for any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
It is conventional wisdom that a property with over one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years ahead.
| 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. |
| Chelsea 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Using our service gives you enhanced control over the value of your Park Royal leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of protracted correspondence with the freeholder of her ground floor flat in Park Royal, Bethan initiated the lease extension process as the 80 year threshold was fast nearing. The transaction was concluded in March 2014. The freeholder’s fees were negotiated to approximately 550 pounds.
In 2011 we were e-mailed by Mr Caleb Garcia who, having took over the lease of a garden apartment in Park Royal in February 2006. The dilemma was if we could estimate the price would be to extend the lease by an additional years. Identical homes in Park Royal with a long lease were worth £265,200. The average amount of ground rent was £65 billed per annum. The lease ran out on 14 October 2091. Taking into account 66 years unexpired we calculated the premium to the freeholder for the lease extension to be between £15,200 and £17,600 not including costs.
An example of a Lease Extension case for a Park Royal premises is 99 Connell Crescent in May 2013. the Tribunal held that the relevant sum for the purposes of the lease extension should be £72,566 to be paid by the leaseholder This case was in relation to 1 flat. The remaining number of years on the lease was 28.42 years.