The closer a domestic lease in Upper Edmonton gets to zero years unexpired, the the greater the reduction in the value of the property. Where the lease has, beyond 125 years remaining then this decrease may be negligible that being said there will become a point in time when a lease has less than eighty years remaining as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the main logic behind why you should extend the lease sooner rather than later. Most flat owners in Upper Edmonton will meet the qualifying criteria; however a lawyer can advise whether you qualify to extend your lease. In limited situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
Leasehold premises in Upper Edmonton with more than 100 years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 conveyancers that we work with undertake Upper Edmonton 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.
Oscar owned a studio flat in Upper Edmonton on the market with a lease of just over 72 years remaining. Oscar informally approached his freeholder being a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a rise in the rent to £200 per annum. No ground rent would be payable on a lease extension were Oscar to exercise his statutory right. Oscar procured expert legal guidance and was able to make a more informed judgement and handle with the matter and ending up with a market value flat.
Dr Alexander White acquired a ground floor flat in Upper Edmonton in January 2009. The question was if we could shed any light on how much (roughly) compensation to the landlord would be to prolong the lease by a further 90 years. Comparable properties in Upper Edmonton with an extended lease were worth £255,000. The average ground rent payable was £50 billed every twelve months. The lease expired in 2095. Considering the 70 years remaining we estimated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 plus professional charges.
In 2010 we were contacted by Mr B Young who, having purchased a purpose-built flat in Upper Edmonton in October 2000. We are asked if we could approximate the price would be for a ninety year extension to my lease. Comparable properties in Upper Edmonton with a long lease were in the region of £246,800. The mid-range ground rent payable was £60 collected quarterly. The lease ended in 2075. Having 50 years as a residual term we estimated the premium to the freeholder for the lease extension to be within £44,700 and £51,600 plus legals.