It’s an underpublicised truth that a Upper Clapton residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the reduction being disguised by increases in the Upper Clapton property market.Where your lease has approximately ninety years left, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips under eighty years - otherwise a higher amount will be due. The majority of leasehold owners in Upper Clapton will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify if you are eligibility. In some situations you may not be entitled. There are also strict timeframes 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 residential leasehold with over one hundred years remaining is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with handle Upper Clapton 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.
Arthur owned a 2 bedroom flat in Upper Clapton being marketed with a lease of a little over 59 years left. Arthur on an informal basis contacted his landlord being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of a rise in the rent to £100 per annum. Ordinarily, ground rent would not be due on a lease extension were Arthur to invoke his statutory right. Arthur obtained expert advice and was able to make a more informed judgement and deal with the matter and readily saleable.
In 2013 we were e-mailed by Mr Samuel Green who, having purchased a basement apartment in Upper Clapton in November 2009. The dilemma was if we could approximate the premium would likely be to prolong the lease by an additional years. Comparable flats in Upper Clapton with an extended lease were worth £275,000. The average amount of ground rent was £65 collected yearly. The lease terminated in 2094. Taking into account 68 years as a residual term we approximated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 not including expenses.
An example of a Lease Extension decision for a Upper Clapton flat is Flat 25, Stamford Hill Mansions Stamford Hill in April 2010. The Tribunal therefore determined that the premium to be paid by the lessee to the freeholder for the extension of the lease should be £28,984.00 This case was in relation to 1 flat. The remaining number of years on the lease was 59 years.