Bishopston leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Legislation has been in place for sometime now which permits qualifying Bishopston residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Bishopston you must check if your lease has between seventy and 90 years left. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
Leasehold residencies in Bishopston with over 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Regardless of whether you are a tenant or a freeholder in Bishopston,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Bishopston valuers.
Aiden was the the leasehold proprietor of a high value apartment in Bishopston being sold with a lease of just over fifty eight years unexpired. Aiden on an informal basis approached his landlord a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £100 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Aiden to invoke his statutory right. Aiden procured expert advice and was able to make an informed judgement and deal with the matter and ending up with a market value flat.
Last Spring we were approach by Mr and Mrs. H Edwards , who was assigned a lease of a one bedroom flat in Bishopston in July 2011. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to extend the lease by 90 years. Comparable flats in Bishopston with an extended lease were valued around £250,000. The average amount of ground rent was £50 collected yearly. The lease elapsed on 11 July 2094. Taking into account 69 years unexpired we calculated the premium to the landlord for the lease extension to be between £9,500 and £11,000 exclusive of costs.
In 2009 we were approached by Ms T Moore who, having completed a ground floor apartment in Bishopston in August 2012. The dilemma was if we could approximate the price could be for a ninety year lease extension. Identical premises in Bishopston with a long lease were valued around £285,000. The average ground rent payable was £55 collected annually. The lease expired on 27 July 2105. Given that there were 80 years outstanding we calculated the compensation to the landlord to extend the lease to be between £12,400 and £14,200 exclusive of professional charges.