When it comes to long leasehold property in Purfleet, you effectively rent it for a certain amount of time. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you may think about a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately more expensive particularly when there are less than 80 years remaining. Leasehold owners in Purfleet with a lease nearing 81 years remaining should seriously consider extending it without delay. Once a lease has below eighty years left, under the current legislation the landlord can calculate and levy a greater premium, assessed on a technical computation, strangely termed as “marriage value” which is due.
It is conventional wisdom that a residential leasehold with over one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Godiva Mortgages | 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
Irrespective of whether you are a tenant or a landlord in Purfleet,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Purfleet valuers.
Two years ago Alexander, started to get close to the 80-year mark with the lease on his basement flat in Purfleet. Having bought his flat twenty years ago, the length of the lease was of little importance. Fortunately, he became aware that he needed to take steps soon on Extending the lease. Alexander was able to extend his lease at the eleventh hour in June. Alexander and the landlord subsequently settled on sum of £5,000 . If the lease had fallen to less than eighty years, the figure would have gone up by a minimum £1,025.
Last Autumn we were e-mailed by Mr O Martínez , who purchased a one bedroom flat in Purfleet in May 1995. The question was if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Comparable premises in Purfleet with 100 year plus lease were valued around £255,000. The mid-range ground rent payable was £50 invoiced per annum. The lease ended on 14 August 2095. Taking into account 70 years as a residual term we approximated the premium to the landlord to extend the lease to be within £10,500 and £12,000 plus expenses.
An example of a Lease Extension decision for a Purfleet premises is Various @ Colombus Square in January 2012. the Tribunal calculated the premiums to be paid for new leases for each of the flats in Mariners Walk to be £3822 and the premium to be paid for the new lease of 2 Knights Court to be £4439. This case was in relation to 13 flats. The number of years remaining on the existing lease(s) was 76 years.