Unfortunately that a Thame residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the deflation being disguised by increases in the Thame property prices.Where your lease has approximately ninety years left, you should start considering a lease extension. If lease term falls under eighty years, you will end up paying 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 The majority of flat owners in Thame will be able to extend under the legislation; however a conveyancer should be able to clarify if you are eligibility. In some cases you may not qualify. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the formalities.
Leasehold properties in Thame with over 100 years remaining 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 circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | |
| Barnsley Building Society | |
| Birmingham Midshires | |
| National Westminster Bank | |
| Virgin |
The conveyancing solicitors that we work with undertake Thame 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 lawyer we work with provide it.
Sebastian owned a high value apartment in Thame being sold with a lease of fraction over fifty eight years remaining. Sebastian informally approached his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent at the outset set at £100 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Sebastian to invoke his statutory right. Sebastian procured expert advice and was able to make an informed judgement and handle with the matter and readily saleable.
In 2013 we were approached by Dr B François who, having purchased a purpose-built apartment in Thame in October 1998. We are asked if we could estimate the price would likely be for a ninety year lease extension. Comparative homes in Thame with an extended lease were in the region of £300,000. The average ground rent payable was £50 billed every twelve months. The lease came to a finish in 2102. Taking into account 76 years as a residual term we calculated the premium to the freeholder to extend the lease to be between £8,600 and £9,800 plus legals.
In 2010 we were called by Mr Jude Clark who, having owned a ground floor apartment in Thame in November 1999. We are asked if we could estimate the price could be to extend the lease by 90 years. Identical flats in Thame with a long lease were valued around £257,800. The average ground rent payable was £65 billed annually. The lease came to a finish in 2091. Taking into account 65 years outstanding we estimated the compensation to the landlord to extend the lease to be within £18,100 and £20,800 exclusive of fees.