Owners of leasehold flats are being warned to look out for the expiry date of their properties lease after a BBC story uncovered the practice of freeholders adding 'Marriage Value' to leasehold extensions when a properties lease starts to run down.

Marriage value is the increase in the value of the property following the completion of the lease extension, and it is designed to reflect the additional market value of the property with a longer lease. This potential ‘profit’ only arises from the freeholders obligation to grant the new lease, and the legislation requires that it is shared equally between the freeholder & leaseholder. 

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Marriage Value Lease Extension

Marriage Value only commences when a property has less than 80 years left on its lease, so owners of leasehold flats are advised to check when their lease runs down, particulalry with short-term leases also being much harder to sell. 

Read more in the BBC article here.. https://www.bbc.co.uk/news/business-51026374

and find out more from the Lease Advice Service here https://www.lease-advice.org/lease-glossary/marriage-value/

 

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