With a domestic leasehold property in South Lambeth, you effectively rent it for a certain amount of time. In recent years flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you may think about extending the lease sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly especially when there are less than 80 years left. Leasehold owners in South Lambeth with a lease approaching 81 years unexpired should seriously think of extending it sooner rather than later. When the lease term has less than eighty years remaining, under the current statute the landlord can calculate and levy a greater premium, assessed on a technical multiplication, strangely termed as “marriage value” which is payable.
It is generally accepted that a residential leasehold with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 30 years left, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
The lawyers that we work with handle South Lambeth 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.
Aiden owned a 2 bedroom apartment in South Lambeth being marketed with a lease of just over sixty years unexpired. Aiden informally approached his freeholder being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent to start with set at £100 per annum and increase every 25 years thereafter. No ground rent would be payable on a lease extension were Aiden to invoke his statutory right. Aiden procured expert legal guidance and secured an acceptable deal without resorting to tribunal and ending up with a market value flat.
In 2010 we were approached by Mrs Abigail Hall who, having purchased a garden flat in South Lambeth in January 2002. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be for a ninety year lease extension. Similar premises in South Lambeth with 100 year plus lease were in the region of £218,000. The average ground rent payable was £45 collected quarterly. The lease finished in 2088. Considering the 63 years unexpired we estimated the premium to the freeholder for the lease extension to be between £17,100 and £19,800 not including fees.
Last Winter we were e-mailed by Dr Rachel Michel , who owned a basement apartment in South Lambeth in June 2005. We are asked if we could approximate the price would likely be to extend the lease by 90 years. Comparable homes in South Lambeth with an extended lease were worth £265,000. The mid-range amount of ground rent was £55 collected annually. The lease lapsed in 2099. Given that there were 74 years left we estimated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 plus legals.