Unfortunately that a Smethwick residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Smethwick property market.Once your lease gets to 85ish years, you should start thinking about a lease extension. If lease term drops 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. The marriage fee is the amount of extra value that a lease extension will add the property Most flat owners in Smethwick will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify 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 for the duration of the formalities.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 30 years left, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barclays plc | |
| Coventry Building Society | |
| Leeds Building Society | |
| TSB | |
| Royal Bank of Scotland |
The lawyers that we work with undertake Smethwick 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 conveyancer we work with provide it.
Last year Leo, came precariously near to the eighty-year mark with the lease on his first floor apartment in Smethwick. Having bought his home 19 years previously, the length of the lease was of little concern. Thankfully, he realised he would imminently be paying an escalated premium for a lease extension. Leo extended the lease just in the nick of time last April. Leo and the freeholder via the management company eventually agreed on sum of £5,000 . If the lease had dropped below eighty years, the amount would have increased by a minimum £1,075.
Last February we were phoned by Mr Liam Moreau , who moved into a garden apartment in Smethwick in March 2010. The dilemma was if we could approximate the compensation to the landlord could be to prolong the lease by a further 90 years. Comparative properties in Smethwick with 100 year plus lease were worth £240,600. The average amount of ground rent was £60 billed every twelve months. The lease termination date was on 20 September 2088. Taking into account 62 years unexpired we calculated the compensation to the landlord for the lease extension to be within £21,900 and £25,200 exclusive of costs.
Last Winter we were called by Mr and Mrs. L Cooper , who purchased a garden apartment in Smethwick in June 1997. The question was if we could approximate the price would be for a 90 year lease extension. Similar homes in Smethwick with an extended lease were valued around £174,200. The average amount of ground rent was £55 invoiced every twelve months. The lease elapsed on 17 June 2077. Given that there were 51 years as a residual term we calculated the compensation to the landlord to extend the lease to be between £31,400 and £36,200 plus expenses.