With a domestic leasehold premises in Beaminster, you are in fact renting it for a certain period of time. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you should think about extending the lease sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly especially when there are less than eighty years left. Leasehold owners in Beaminster with a lease nearing 81 years unexpired should seriously consider extending it without delay. Once the lease term has below 80 years remaining, under the relevant Act the landlord is entitled to calculate and demand a larger amount, assessed on a technical calculation, known as “marriage value” which is due.
It is generally accepted that a residential leasehold with in excess of one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| Yorkshire Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
Engaging our service will provide you enhanced control over the value of your Beaminster leasehold, as your property will be more valuable and saleable in relation to the lease length should you want to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to lengthy correspondence with the landlord of her purpose-built flat in Beaminster, Natalie started the lease extension process as the 80 year mark was swiftly advancing. The legal work was finalised in March 2011. The landlord’s fees were kept to an absolute minimum.
Last Spring we were approach by Mr Jude Laurent , who took over the lease of a purpose-built flat in Beaminster in April 2012. We are asked if we could approximate the premium would be to extend the lease by a further 90 years. Comparable flats in Beaminster with an extended lease were worth £200,800. The average amount of ground rent was £65 collected annually. The lease lapsed in 2086. Considering the 60 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £20,900 and £24,200 exclusive of expenses.
Mr and Mrs. M Davis acquired a one bedroom apartment in Beaminster in November 2012. We are asked if we could approximate the compensation to the landlord would likely be for a 90 year extension to my lease. Identical premises in Beaminster with an extended lease were worth £255,000. The average amount of ground rent was £50 billed annually. The lease ended on 21 July 2097. Having 71 years unexpired we approximated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 not including expenses.