Park Royal leases on residential properties are gradually losing value. Where your lease has about 90 years unexpired, you should start thinking about a lease extension. If lease term falls under 80 years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to your landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Flat owners in Park Royal will usually be legally entitled to a lease extension; however a solicitor should be able check your eligibility. In certain situations you may not qualify. There are prescribed timetables and steps to comply with once the process has commenced so it’s sensible to be guided by a conveyancing solicitor during the process.
Leasehold residencies in Park Royal with in excess of one hundred years left on the lease are sometimes regarded as a ‘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 upside in buying the reversionary interest unless savings on ground rent and estate charges warrant it.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| 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 Park Royal,the lease extension lawyers 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 Park Royal valuers.
In recent months Austin, started to get near to the eighty-year mark with the lease on his purpose- built apartment in Park Royal. In buying his flat two decades ago, the unexpired term was of little interest. As luck would have it, he realised he needed to take action soon on Extending the lease. Austin arranged for a lease extension just in the nick of time in March. Austin and the landlord eventually agreed on the final figure of £5,000 . If he not met the deadline, the amount would have gone up by at least £900.
Last Spring we were contacted by Mr Evan Bernard , who purchased a newly refurbished flat in Park Royal in March 1997. We are asked if we could estimate the premium would likely be to prolong the lease by 90 years. Identical homes in Park Royal with a long lease were valued about £200,000. The average ground rent payable was £50 billed monthly. The lease lapsed in 2103. Given that there were 77 years as a residual term we calculated the compensation to the landlord for the lease extension to be between £8,600 and £9,800 not including fees.
An example of a Lease Extension case for a Park Royal property 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 related to 1 flat. The unexpired term was 28.42 years.