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Most popular advice guides

Service charges and other issues

Service charges, administration charges, ground rent, recognised tenants associations and forfeiture. For a brief summary...

Leasehold Extension – Getting Started

The right to extend the lease of a flat under the Leasehold Reform Housing and...

Living in Leasehold Flats – A guide to how it works

The nature and typical rights and obligations that relate to the ownership of a leasehold...

Section 20 Consultation for Private Landlords, Resident Management Companies and their Agents

Consultation for qualifying works to a building and qualifying long-term agreements. Purpose of this booklet...

Leasehold Houses – Buying the freehold – Qualification and procedure

Qualification requirements for a tenant to buy the freehold of their leasehold house and outline...

Right to Manage

The right for leaseholders of a building containing flats to take over the management of...

What is ‘hedonic regression’ for lease extensions?

Hedonic regression is a statistical method used to isolate the effect on value of a single variable. In the case of lease extension, it is the unexpired length of the lease.

A hedonic regression model for lease extensions was created by Parthenia Valuation, ‘the Parthenia Model’. It had been used to determine ‘relativity’ i.e. the relative value of a property held on an existing long lease compared to its ‘freehold vacant possession value’; and is intended to provide, as the 1993 Act requires, a ‘no act world’ when it comes to valuing for lease extension.

In Trustees of the Sloane Stanley Estate v Mundy [2016] the Upper Tribunal (Land Chamber)  it was held that the Parthenia Model should no longer be used. However, the case is being appealed to the Court of Appeal.

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