Expert Lease Extension Valuations by Cheke & Co
The unexpired term of a lease naturally reduces over time. However, when it reaches a certain level, it can have a negative effect on the value of a property and its overall saleability. In extreme cases some lenders will refuse to offer a mortgage or remortgage as a result.
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Our Lease Extension Valuation Services
To avoid such situations occurring our Chartered Surveyors can provide expert advice in this field to extend a lease. This will include recommendations in terms of the costs associated with a statutory lease extension. They also liaise with relevant solicitors who will process any formal lease renewal.
Whether you are a homeowner or a property investor, gaining expert advice is essential. We evaluate all relevant factors and provide our recommendations based on the individual circumstances of the client concerned thus enabling them to then make an informed decision with all the facts to hand.
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In-Depth Property Valuation
Our surveyor will visit the property concerned with a view to assessing the open market value of the property taking into account the current unexpired term of the lease. They will also consider the positive impact on this valuation if the lease were to be extended.
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Analysis
As part of the relevant analysis undertaken our surveyors will consider various key aspects including the overall size of the property, its location, and general condition.
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Professional Advice and Guidance
The process of navigating lease extensions is not straightforward. Our specialists follow a pre-defined process for assessing the true value of a lease extension and the associated costs involved of doing so. Terms within the current lease will have to be considered, as will existing and future charges for things such as ground rent.
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Transparent and Detailed Reporting
Transparency is at the core of our service. We provide you with detailed reports that outline our valuation, the various factors considered, and offer any other guidance and support required.
Situations Where You Should Get A Lease Extension
Understanding the situations that warrant a lease extension valuation is essential. Here are some scenarios where our expertise comes into play:
Property Sale
Trying to sell a property with a short lease can often prove difficult. Many lenders will not be prepared to grant a mortgage to any interested buyer which will inevitably restrict its appeal, value, and general saleability. Therefore, consideration should be given to extending the lease prior to marketing your property for sale.
Lease Renewal
For those homeowners looking to remortgage a property this may prove challenging as most lenders are reluctant to grant such loans until they know the lease will be extended in line with their own lending criteria. Therefore, ideally the lease should be extended prior to approaching any lenders for more funding.
Lease Enfranchisement
In cases of collective enfranchisement, which is where all leaseholders in a particular development seek to acquire the freehold from the current owner, a valuation is required for such purposes.
Leasehold Enlargement
If you plan to extend your lease for added years, a valuation guides the extension cost.
Lease Transfer
When transferring a lease, understanding its value prevents overpayment or undervaluation.
Legal Disputes
Valuations play a crucial role in resolving lease-related legal disputes, and ensuring fair outcomes.
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Trust & Confidence
Our team comprises RICS chartered valuers with extensive experience in lease extension valuations. We combine industry knowledge, technical expertise, and a client-centric approach to provide an unparalleled service.
With a proven track record since 1873, Cheke & Co could become a trusted partner for all your lease extension needs.
Navigating Lease Extension Valuations with Confidence
When the term of a lease diminishes, if appropriate action is not taken to increase its length, then this could have a detrimental effect on both its value and overall saleability. At Cheke & Co, we have, over many acted for thousands of clients to protect their property investments.
Qualification Criteria and Your Options
To qualify for a lease extension, specific conditions must be met, including continuous ownership for the past 2 years and a remaining lease term exceeding 21 years. You have two primary options: ask your freeholder if they would offer a new lease and confirm what the associated costs would be to do so or take a more formal route via a solicitor confirming your intention to formally enter negotiations for a statutory extension of the lease. Although some people will adopt the more informal route initially once the freeholder sets out their conditions the leaseholder will not know if they are fair and reasonable.
Our Approach
The lease extension valuation encompasses factors like loss of ground rent charges from the freeholder’s perspective, deferment costs, marriage value and any potential compensation due to the landlord for extending the lease. Our detailed report offers best and worst-case scenario valuations plus we can provide additional advice to assist with ongoing negotiations.
Why Choose Us
If a client is concerned that they may not be offered a fair and reasonable proposal, should they approach the freeholder directly to extend the term of their lease, Cheke & Co retain the relevant expertise to ensure they are provided with reliable and independent advice. This will include a valuation of what we believe they should be paying by way of a premium to the freeholder for granting permission to extend the lease. Without such advice clients may find themselves exploited financially spending more than is necessary. Therefore, investing in the services and advice of one of our surveyors we believe will represent genuine value for money.
FAQs
Generally, once the term of an unexpired lease falls below 85 years some form of action should be considered otherwise the general value of the property and its overall saleability could be negatively affected. This could also be relevant to anyone looking to remortgage their property as many lenders will be reluctant to offer further advances whilst the unexpired term of the lease continues to reduce.
Several factors influence the value, including property size, its condition and location. Other matters considered will include the current unexpired term of the lease, any payments made to the freeholder such as ground rent as well as the general state of the housing market at the particular time.
Providing a client has been provided with all appropriate advice from a Chartered surveyor which includes their thoughts in terms of a valuation then they should feel confident to move forward and begin negotiations either directly with the freeholder or a solicitor. At Cheke & Co any recommendations we provide will be comprehensive and based on significant research and industry expertise.
Much will depend on who is appointed to undertake such work. Many companies who profess to be specialists in this field will only undertake a ‘remote’ desktop valuation. This will naturally speed up the process but the final recommendations especially in terms of the valuation may be inaccurate. Every property is different and cannot in our view be properly appraised from a distance. At Cheke & Co we will adopt a more comprehensive approach which will incorporate a visual inspection on site. This will obviously delay the turnaround time slightly, but we would hope to have everything back to our clients within 7 days of accessing the property.
A lease renewal is effectively the creation of a brand-new lease, and a lease extension is merely extending the unexpired term of an existing lease. Our specialist surveyors are happy to provide more detailed advice upon request.
Yes, expert valuations can play a crucial role in resolving lease-related legal disputes by providing an unbiased assessment of the property’s value. At Cheke & Co our ultimate objective is to provide sound valuations and advice which helps our clients reduce the possibility of engaging in a dispute with their freeholder. However, if a dispute proves unavoidable then our expertise should hopefully help reduce both the time and related costs spent in reaching a mutually acceptable conclusion for all parties involved.
If a group of different leaseholders owning properties within the same development want to collectively extend their leases or acquire the freehold, a single valuation can be used to support either offer.