It’s an underpublicised truth that a Redbridge residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Redbridge property market.Once your lease gets to 85ish years, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips under 80 years - otherwise a higher amount will be due. Most leasehold owners in Redbridge will be able to extend under the legislation; however a lawyer will be able to clarify if you are eligibility. In some situations you may not qualify. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your lawyer for the duration of the process.
Leasehold properties in Redbridge with in excess of one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with undertake Redbridge lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancing solicitor we work with provide it.
18 months ago Joshua, started to get close to the 80-year mark with the lease on his first floor apartment in Redbridge. Having bought his flat 18 years previously, the length of the lease was of minimal relevance. As luck would have it, he realised he needed to take steps soon on Extending the lease. Joshua extended the lease just ahead of time last July. Joshua and the landlord who owned the flat above subsequently agreed on sum of £6,000 . If he failed to meet the deadline, the amount would have escalated by at least £975.
Last Summer we were contacted by Dr O Morgan , who owned a first floor flat in Redbridge in July 2007. The question was if we could estimate the price could be to extend the lease by ninety years. Similar flats in Redbridge with an extended lease were worth £176,200. The average ground rent payable was £65 invoiced yearly. The lease concluded on 17 July 2081. Taking into account 56 years outstanding we approximated the compensation to the landlord for the lease extension to be between £29,500 and £34,000 plus expenses.
An example of a Freehold Enfranchisement matter before the tribunal for a Redbridge flat is 59 & 59a Clarendon Gardens in February 2014. The Tribunals valuation for the freehold was £30,073.00 The number of years remaining on the existing lease(s) was 65 and 61.