Outline Numbers Lease For Free

The value of the leasehold interest is determined by the terms of the lease, including the length of the lease and the rent paid. If the rent paid is lower than current market rates, the leasehold value may be higher.

Calculating the term (the ground rent the landlord would expect to receive over the life of the existing lease) This ground rent figure is multiplied by the 'years purchase', which is a multiplier calculated by the valuer or, more usually, taken from valuation tables.

It specifically refers to the difference between a leasehold property's value before and after the 80-year lease is extended. In other words, the Marriage Value of a property reflects the extra market value of a leasehold property once the lease has been extended.

Leasehold Valuation ? The net leasehold value is then calculated by taking the direct cap value of the property before the ground lease, and subtracting out the present value of the ground lease.

A Section 42 Notice is a formal request from a leaseholder to the freeholder or landlord (or both) and any other appropriate party to extend their lease on a property. This provides a leaseholder with an extension of 90 years on top of the remaining lease term and a ground rent reduced to zero.

In general, the word 'leasehold' means the value or right owned by tenants, under lease agreements which will be different from the value of the landlord or owner. The leasehold value usually arises with long-term lease agreements in which the first payment sum or 'upfront' has already been paid to the landlord.

Calculating the marriage value involves subtracting the freeholder's and leaseholder's interest in the property before the lease extension from the overall value after the lease is extended. For instance, consider a property valued at £500,000 with 75 years remaining on the lease.

Capital Value is simple to calculate it's the net annual rent divided by the Net Initial Yield. This can also be expressed as Rent multiplied by Years Purchase, where Years Purchase is the inverse of the yield.