RICS LEASE VALUATION

What you need to know:

Whether you are the Freeholder of Lessee it is important to have a RICS Redbook Valuation to understand the value of an existing lease by utilising a Lease Valuation, whether this is to gain a Market Value for sale or whether a term of such lease requires renewing. If a lease term falls below 80 years the Leasehold Reform Act states that a ‘marriage value’ is required to be factored into the lease term renewal. 

This is the difference between the value of the lease prior to extension and once extended, which will need to be paid to the Freeholder as compensation. This can significantly affect the cost implications of renewing a lease term, which is why it is usually beneficial for the lessee to have a lease renewed prior to the term reaching or going below the 80-year term. 

Such valuations should also factor in such costs as loss of reversion, loss of ground rent and current market conditions. Therefore, it is important to engage a competent, experienced RICS Surveying firm to undertake this on your behalf. 

Please contact us regarding RICS Lease Valuations.