Unfortunately that a Bishopsworth residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Bishopsworth property prices.Once your lease nears 85ish years, you need to start considering a lease extension. If the number of years remaining dips under 80 years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property Most leasehold owners in Bishopsworth will be able to extend under the legislation; however a conveyancer will be able to confirm if you are eligibility. In some situations you may not be entitled. There are also strict timeframes and procedures to follow once the process is instigated and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
It is conventional wisdom that a residential leasehold with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be worth the same as 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; |
| Chelsea 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you better control over the value of your Bishopsworth leasehold, as your property will be more valuable and saleable in respect of lease length should you decide to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Last October Jude, started to get near to the 80-year mark with the lease on his purpose- built flat in Bishopsworth. Having purchased his property two decades ago, the length of the lease was of no relevance. by good luck, he noticed he would imminently be paying an escalated premium for a lease extension. Jude extended the lease just under the wire in April. Jude and the freeholder via the managing agents ultimately agreed on a premium of £5,500 . If the lease had slipped lower than eighty years, the price would have escalated by a minimum £850.
Last Autumn we were approach by Mr C Bertrand , who acquired a one bedroom apartment in Bishopsworth in February 1999. The question was if we could estimate the premium would likely be for a ninety year lease extension. Identical properties in Bishopsworth with an extended lease were worth £210,600. The average amount of ground rent was £45 invoiced every twelve months. The lease ended in 2088. Taking into account 62 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £18,100 and £20,800 plus legals.
Last year we were called by Mrs Chloe Laurent , who purchased a one bedroom apartment in Bishopsworth in October 1999. The question was if we could estimate the premium would be to extend the lease by an additional years. Comparative residencies in Bishopsworth with 100 year plus lease were worth £260,000. The average amount of ground rent was £50 billed every twelve months. The lease finished in 2099. Taking into account 73 years outstanding we calculated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 not including costs.