Top reasons for Penshaw lease extension

Main reasons to commence your Penshaw lease extension today:

Increase your lease and increase your Penshaw property value

There is no doubt about it a leasehold property in Penshaw is a wasting asset as a result of the diminishing lease term. If the residual term has, over 99 years remaining then this decrease may be of little impact nevertheless there will become a stage when a lease has fewer than 80 years remaining as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main reason why you should consider extending sooner rather than later. Many flat owners in Penshaw will meet the qualifying criteria; that being said a conveyancer will be able to confirm whether you are eligible for a lease extension. In certain situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.

Penshaw property with a lease extension is almost the same value as a freehold

Leasehold premises in Penshaw with over one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges merit it.

Banks and Building Societies may not issue a mortgage on a short lease

The trend since over the last decade has been for lenders to tighten lending criteria generally - this has extended to the property over which the mortgage is to be charged. This has meant the minimum number of years remaining under the lease required by lenders has increased. In the past banks were content with 25 years plus the term of the loan - typically fifty year leases but those requirements are being increasingly undermined by the requirement for lengthy leases - many now have a minimum term of 75 years as standard.

Get in touch with one of our Penshaw lease extension solicitors or enfranchisement solicitors

Irrespective of whether you are a tenant or a landlord in Penshaw,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Penshaw valuers.

Penshaw Lease Extension Case Summaries:

Muhammad, Penshaw, Tyne And Wear

18 months ago Muhammad, came perilously close to the 80-year threshold with the lease on his basement apartment in Penshaw. In buying his property two decades ago, the unexpired term was of minimal relevance. Thankfully, he recognised he needed to take steps soon on Extending the lease. Muhammad arranged for a lease extension just ahead of time in July. Muhammad and the landlord who owned the flat above eventually settled on an amount of £6,000 . If the lease had slipped below 80 years, the price would have escalated by at least £1,000.

Penshaw case:

Last Christmas we were e-mailed by Ms Laura Mercier , who owned a first floor flat in Penshaw in August 2002. The question was if we could estimate the price would be to extend the lease by a further 90 years. Similar flats in Penshaw with a long lease were valued about £260,000. The mid-range amount of ground rent was £50 collected every twelve months. The lease expired on 5 March 2099. Having 73 years left we approximated the premium to the landlord for the lease extension to be within £9,500 and £11,000 not including fees.

Penshaw case:

In 2009 we were approached by Mr W Roux who, having purchased a purpose-built apartment in Penshaw in October 2006. We are asked if we could approximate the premium would likely be for a ninety year extension to my lease. Comparable premises in Penshaw with an extended lease were worth £264,000. The mid-range ground rent payable was £60 invoiced monthly. The lease came to a finish on 21 April 2079. Considering the 53 years left we estimated the premium to the freeholder to extend the lease to be between £37,100 and £42,800 exclusive of professional charges.