Smithfield leases on domestic properties are gradually losing value. Where your lease has about 90 years left, you should start considering the need for a lease extension. Eighty years is a significant number: when the remaining term of a lease falls below this level then you start incurring an additional element called marriage value. Flat owners in Smithfield will usually be legally entitled to a lease extension; however a solicitor should be able confirm your eligibility. In certain situations you may not qualify. There are prescribed deadlines and formalities to comply with once the process has commenced so it’s wise to be guided by a conveyancer during the process.
It is conventional wisdom that a property with over one hundred years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Chelsea Building Society | |
| Coventry Building Society | |
| Godiva Mortgages | |
| Skipton Building Society | |
| The Mortgage Works |
Irrespective of whether you are a tenant or a landlord in Smithfield,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 experience and the close ties they enjoy with Smithfield valuers.
Last year Samuel, started to get near to the 80-year threshold with the lease on his one bedroom flat in Smithfield. In buying his home two decades ago, the lease term was of no bearing. As luck would have it, it dawned on him that he needed to take action soon on a lease extension. Samuel extended the lease just under the wire last September. Samuel and the freeholder subsequently agreed on sum of £6,000 . If he failed to meet the deadline, the amount would have increased by at least £950.
Dr Sian Garcia completed a one bedroom flat in Smithfield in October 2004. The question was if we could estimate the premium would likely be to prolong the lease by a further 90 years. Similar flats in Smithfield with 100 year plus lease were valued about £200,000. The mid-range amount of ground rent was £50 collected yearly. The lease lapsed on 8 September 2104. Given that there were 78 years outstanding we estimated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 plus costs.
Last month we were called by Mr and Mrs. G Bailey , who purchased a garden flat in Smithfield in June 2002. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would be to prolong the lease by 90 years. Comparable homes in Smithfield with a long lease were in the region of £267,600. The average amount of ground rent was £65 collected yearly. The lease lapsed on 17 July 2093. Considering the 67 years remaining we estimated the premium to the landlord to extend the lease to be between £14,300 and £16,400 exclusive of fees.