The value of Castle Bromwich leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can increase substantially once the unexpired lease term is less than 80 years
Leasehold residencies in Castle Bromwich with over 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and service charges warrant 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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 handle Castle Bromwich 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 lawyer we work with provide it.
Subsequent to unsuccessful discussions with the landlord of her purpose-built flat in Castle Bromwich, Jasmine started the lease extension process as the 80 year deadline was fast advancing. The lease extension completed in October 2012. The landlord’s fees were kept to an absolute minimum.
Dr Omar Laurent acquired a garden apartment in Castle Bromwich in July 2009. We are asked if we could estimate the premium could be to extend the lease by an additional years. Comparable properties in Castle Bromwich with a long lease were valued about £200,000. The mid-range ground rent payable was £50 collected every twelve months. The lease concluded in 2102. Considering the 77 years remaining we approximated the compensation to the landlord to extend the lease to be within £8,600 and £9,800 not including professional charges.
In 2012 we were approached by Dr S Stewart who, having bought a studio flat in Castle Bromwich in November 2000. The question was if we could estimate the compensation to the landlord would be to extend the lease by 90 years. Comparable residencies in Castle Bromwich with an extended lease were worth £265,200. The mid-range amount of ground rent was £65 invoiced per annum. The lease concluded on 23 October 2091. Having 66 years outstanding we estimated the premium to the freeholder to extend the lease to be within £15,200 and £17,600 not including professional charges.