Settlement has been reached finally (more…)
A client recently asked me to advise in the level of premium payable to extend a long lease (more…)
Yesterday the Court of Appeal dismissed (more…)
I was much amused (more…)
A share of the freehold may not seem (more…)
A recent post on the discount rate applying to the enfranchisement of residential leases (more…)
I have been asked to give advice for two separate clients as to the respective premiums to extend (more…)
Recently I was asked to advise a client over a landlord’s license to alter issue on her flat. On reading her lease, I noticed it was about 83.5 years unexpired. As a consequence, I advised her to ensure that she served a s42 notice for an extended 90 year lease before the lease drops to 80 years or less to save her paying a considerably higher premium to include half of the (additional) released marriage value that the landlord would receive.
In carrying out the exercise, I looked at the likely premium payable for an 80.1 year unexpired lease compared to that of one of 79.9 years for this ‘normal’ flat of just over 1000 sqft offering 2 bedroom 1 bathroom accommodation. The additional cost in extending the lease the moment it drops to 80 years or a day under increases by 222.5% from around £36,000 to £80,000.
Conversely the increase is less marked at 190% if the flat was a house due to the lower 0.25% deferment rate adopted of 4.75% adopted.
It is even more important for lessees to be aware of this ‘cliff’ if they have recently acquired the lease without taking an assigned notice from the vendor as the 2 year ownership rule will apply before being able to serve notice in one’s own right.
This is an issue that has emerged in enfranchisement circles (more…)