It’s an underpublicised certainty that a Selsdon residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Selsdon property market.Once your lease nears 85ish years, you should start considering a lease extension. If the number of years remaining falls below 80 years, you will then be required to pay 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Selsdon will be able to extend under the legislation; however a conveyancer will be able to confirm whether you are eligibility. In some situations you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancer throughout the process.
It is conventional wisdom that a property with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service gives you increased control over the value of your Selsdon leasehold, as your property will be more valuable and saleable in respect of lease length should you decide to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Leo owned a 2 bedroom flat in Selsdon being sold with a lease of a few days over 59 years remaining. Leo informally contacted his landlord being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of an increased rent to £100 per annum. No ground rent would be due on a lease extension were Leo to invoke his statutory right. Leo obtained expert legal guidance and was able to make a more informed decision and deal with the matter and ending up with a market value flat.
Mr O Lewis moved into a one bedroom apartment in Selsdon in November 2008. We are asked if we could estimate the premium would likely be to prolong the lease by 90 years. Comparable residencies in Selsdon with an extended lease were valued around £255,000. The mid-range amount of ground rent was £50 collected per annum. The lease ran out on 8 January 2096. Having 71 years as a residual term we approximated the premium to the landlord for the lease extension to be within £9,500 and £11,000 plus fees.
An example of a Freehold Enfranchisement matter before the tribunal for a Selsdon property is The Woodlands 95 Purley Park Road in April 2009. The Tribunals own valuation produced the figure of £37,912. This case related to 6 flats. The number of years remaining on the existing lease(s) was 78.32 years.