It’s an underpublicised certainty that a Upper Tooting residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the Upper Tooting property market.Where your lease has approximately ninety years left, you need to start considering a lease extension. If the number of years remaining drops under 80 years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property Most flat owners in Upper Tooting will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm whether you qualify for an extension. In some situations you may not be entitled. There are also strict timeframes and procedures to follow once the process is instigated and you will need to be guided by your conveyancing solicitor for the duration of the formalities.
Leasehold properties in Upper Tooting with in excess of 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges justify it.
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Engaging our service will provide you enhanced control over the value of your Upper Tooting leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Noah owned a studio flat in Upper Tooting being marketed with a lease of a few days over sixty years left. Noah informally spoke with his landlord being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £100 per annum. Ordinarily, ground rent would not be payable on a lease extension were Noah to invoke his statutory right. Noah procured expert legal guidance and secured satisfactory deal informally and ending up with a market value flat.
Last Winter we were contacted by Mr P King , who owned a garden apartment in Upper Tooting in November 1995. The dilemma was if we could estimate the compensation to the landlord would likely be to prolong the lease by a further 90 years. Identical properties in Upper Tooting with a long lease were worth £235,200. The average amount of ground rent was £45 collected yearly. The lease terminated in 2092. Having 66 years left we calculated the premium to the landlord for the lease extension to be within £12,400 and £14,200 plus costs.
Last July we were phoned by Mr and Mrs. C Phillips , who acquired a ground floor flat in Upper Tooting in May 1995. The dilemma was if we could estimate the premium could be to extend the lease by 90 years. Comparative homes in Upper Tooting with a long lease were worth £280,000. The mid-range ground rent payable was £55 invoiced quarterly. The lease expired in 2103. Taking into account 77 years left we estimated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 plus professional charges.