With a long leasehold premises in Peckham, you are in fact renting it for a certain amount of time. Modern flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you should think about extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease gets disproportionately greater especially when there are less than eighty years left. Residents in Peckham with a lease approaching 81 years left should seriously consider extending it without delay. When a lease has fewer than eighty years left, under the relevant legislation the landlord can calculate and levy a greater premium, assessed on a technical calculation, known as “marriage value” which is payable.
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years left, the property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| 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:
|
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service gives you increased control over the value of your Peckham leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Lewis owned a 2 bedroom apartment in Peckham being sold with a lease of fraction over 72 years left. Lewis on an informal basis spoke with his freeholder a well known Bristol-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 an increased rent to £50 per annum. Ordinarily, ground rent would not be due on a lease extension were Lewis to invoke his statutory right. Lewis procured expert advice and was able to make an informed decision and handle with the matter and sell the flat.
Mrs Chelsea Clarke acquired a one bedroom flat in Peckham in May 2009. The question was if we could shed any light on how much (roughly) compensation to the landlord would likely be for a ninety year lease extension. Identical residencies in Peckham with 100 year plus lease were valued around £267,600. The mid-range amount of ground rent was £65 collected every twelve months. The lease terminated on 19 September 2093. Considering the 67 years as a residual term we calculated the compensation to the freeholder for the lease extension to be between £14,300 and £16,400 exclusive of fees.
An example of a Freehold Enfranchisement case for a Peckham flat is 31 Kings Grove in January 2012. By a claim form issued on 11" August 2011 under action number 1LB01618 in the Lambeth County Court the applicant tenants sought dispensation under section 26 of the Leasehold Reform, Housing and Urban Development Act 1993 from the requirement to serve a notice under section 13 of that Act in order to purchase the freehold of the premises. The Tribunal decided the amount payable for the freehold as £10,728 This case related to 2 flats. The unexpired term as at the valuation date was 80.5 years.