Bishops Cleeve leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. Legislation has been in place for sometime now which entitles qualifying Bishops Cleeve residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Bishops Cleeve you would be well advised to see if your lease has between 70 and 90 years remaining. There are compelling reasons why a Bishops Cleeve leaseholder with a lease having around 80 years unexpired should take steps to ensure that a lease extension is effected without delay
Leasehold properties in Bishops Cleeve with in excess of one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Godiva Mortgages | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
The lawyers that we work with undertake Bishops Cleeve lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancer we work with provide it.
After protracted correspondence with the freeholder of her first floor apartment in Bishops Cleeve, Harriet commenced the lease extension process as the eighty year threshold was swiftly nearing. The transaction was concluded in October 2012. The freeholder’s fees were kept to an absolute minimum.
Dr Charlie Walker purchased a ground floor apartment in Bishops Cleeve in March 1998. We are asked if we could approximate the premium could be to extend the lease by an additional years. Identical properties in Bishops Cleeve with a long lease were worth £174,200. The average amount of ground rent was £55 collected per annum. The lease terminated in 2077. Taking into account 51 years remaining we calculated the premium to the freeholder to extend the lease to be within £31,400 and £36,200 exclusive of fees.
Last Summer we were called by Mrs L Roberts , who bought a studio apartment in Bishops Cleeve in February 1998. We are asked if we could shed any light on how much (approximately) price could be to prolong the lease by an additional years. Comparable residencies in Bishops Cleeve with a long lease were valued around £280,000. The mid-range amount of ground rent was £45 billed per annum. The lease lapsed on 8 July 2097. Given that there were 71 years as a residual term we estimated the compensation to the landlord for the lease extension to be between £12,400 and £14,200 not including professional charges.