Penley leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. It is the case that most Penley tenants have the right to extend their lease by an additional 90 years by virtue of the 1993 Leasehold Reform Act. Where you are a leasehold owner in Penley you must investigate if your lease has between 70 and ninety years left. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
It is generally accepted that a residential leasehold with more than 100 years remaining is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 30 years left, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
Regardless of whether you are a tenant or a freeholder in Penley,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Penley valuers.
Off the back of unsuccessful correspondence with the landlord of her one bedroom apartment in Penley, Sian initiated the lease extension process just as her lease was approaching the all-important 80-year mark. The transaction was concluded in June 2014. The landlord’s costs were kept to an absolute minimum.
Last year we were phoned by Dr V Norbert , who purchased a studio flat in Penley in January 2006. The dilemma was if we could approximate the price would be for a 90 year extension to my lease. Identical properties in Penley with a long lease were in the region of £220,400. The average amount of ground rent was £45 invoiced monthly. The lease concluded in 2089. Given that there were 64 years as a residual term we calculated the compensation to the freeholder to extend the lease to be within £15,200 and £17,600 plus legals.
Last Winter we were contacted by Mr and Mrs. R Watson , who moved into a purpose-built flat in Penley in March 2012. We are asked if we could shed any light on how much (approximately) price would be for a 90 year lease extension. Identical properties in Penley with an extended lease were worth £270,000. The average amount of ground rent was £55 billed quarterly. The lease ran out on 14 February 2100. Taking into account 75 years remaining we estimated the premium to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of costs.