As the length of the unexpired term of a Shoreditch residential lease diminished so does its value and therefore the value of your property. If the lease has, over 125 years to run then this decrease may be of little impact nevertheless there will become a stage when a lease has under than 80 years left as part of the premium you will incur is what is known as a marriage value. This could increase sharply the cost. It is the primary rational as to why you should extend the lease without delay. Many flat owners in Shoreditch will qualify for this right; that being said a conveyancer can confirm if you qualify to extend your lease. 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.
Leasehold properties in Shoreditch with more than one hundred years left on the lease are often 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 buying the freehold unless savings on ground rent and estate charges warrant 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Using our service will provide you enhanced control over the value of your Shoreditch leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Archie, came critically near to the 80-year mark with the lease on his first floor flat in Shoreditch. In buying his home 19 years previously, the lease term was of minimal bearing. by good luck, it dawned on him that he would imminently be paying way over the odds for a lease extension. Archie arranged for a lease extension at the eleventh hour last August. Archie and the landlord who owned the flat above subsequently settled on a premium of £6,000 . If he failed to meet the deadline, the figure would have become more costly by at least £875.
In 2014 we were contacted by Ms O Richardson who, having owned a purpose-built apartment in Shoreditch in May 1996. We are asked if we could approximate the price could be for a ninety year extension to my lease. Identical properties in Shoreditch with 100 year plus lease were valued about £205,000. The average ground rent payable was £50 collected per annum. The lease termination date was on 28 April 2104. Having 78 years remaining we approximated the compensation to the landlord for the lease extension to be between £8,600 and £9,800 exclusive of professional charges.
An example of a Lease Extension decision for a Shoreditch residence is 137 & 139 Haberdasher Street in December 2013. The Tribunal determines in accordance with section 48 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 that the premium for the extended lease for each Property should be £12,350.00. This case was in relation to 2 flats. The remaining number of years on the lease was 72.39 years.