It’s a harsh certainty that a Bletchley residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the Bletchley property prices.Where your lease has approximately ninety years left, you should start considering a lease extension. If lease term falls under eighty years, you will end up paying 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property The majority of leasehold owners in Bletchley will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify whether 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 lawyer for the duration of the process.
It is conventional wisdom that a residential leasehold with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 35 years left, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| 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 Bletchley leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
In recent months Jacob, came dangerously near to the eighty-year mark with the lease on his first floor apartment in Bletchley. Having bought his flat two decades ago, the unexpired term was of no relevance. As luck would have it, he became aware that he needed to take action soon on Extending the lease. Jacob extended the lease just under the wire in March. Jacob and the landlord eventually agreed on the final figure of £6,000 . If he not met the deadline, the figure would have become more costly by a minimum £1,100.
In 2011 we were e-mailed by Mr and Mrs. T Robinson who, having bought a one bedroom flat in Bletchley in April 2006. We are asked if we could approximate the compensation to the landlord could be to prolong the lease by an additional years. Comparable properties in Bletchley with an extended lease were in the region of £208,200. The average ground rent payable was £65 invoiced per annum. The lease finished on 25 May 2087. Considering the 61 years left we estimated the premium to the landlord to extend the lease to be between £20,000 and £23,000 not including professional charges.
In 2011 we were called by Ms P Gray who, having bought a garden flat in Bletchley in March 2002. The question was if we could approximate the price would be to prolong the lease by a further 90 years. Similar premises in Bletchley with an extended lease were worth £260,000. The average amount of ground rent was £50 billed yearly. The lease ran out on 10 October 2098. Considering the 72 years outstanding we approximated the premium to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of fees.