By Press Release
If you own leasehold property, as opposed to freehold, you have a temporary right to occupy the property which is granted to you by a document called a lease.
Amongst other things, the lease sets out the term of years that you are allowed to occupy the property for. Whilst this may not seem ideal at first glance, usually lease terms are around 99, 125 or 999 years so – of fair length. However, with each year that passes the lease and therefore your property, decreases in value.
Eighty years is widely considered to be the magic number when it comes to lease extensions, as letting your lease drop below the 80 year mark means the premiums associated with extending it begin to jump dramatically as marriage value (the value increase generated by a new lease being granted) starts to become payable. The longer the lease is left before it is extended, the more securing an extension is likely to cost you.
There are a number of lease extension calculators available online which will give you a rough estimate of the premium you can expect to pay for the extension, although it is always advisable to instruct a qualified surveyor to provide you with reliable advice about the appropriate premium in your circumstances.
You should also be aware that dwindling lease terms are likely to be raised by any prospective buyers solicitor should you decide to sell the property. In particular, mortgage lenders have very stringent requirements about the length of lease term they will accept.
Accordingly it is really important to be proactive and not let your lease term dip below 80 years. If you would like advice about the options available to extend your lease or would like to instruct someone to act for you to extend your lease, please speak to a member of our friendly Residential Property team today on 01983 533938.