Unfortunately that a Chesham residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the depreciation being disguised by increases in the Chesham property prices.Where your lease has approximately 90 years left, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips lower than 80 years - otherwise a higher amount will be due. The majority of leasehold owners in Chesham will be able to extend under the legislation; however a lawyer should be able to confirm whether you qualify for an extension. In some cases you may not qualify. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor for the duration of the process.
It is generally considered that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further 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 |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with undertake Chesham 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.
Charlie was the the leasehold proprietor of a high value apartment in Chesham on the market with a lease of just over 61 years left. Charlie on an informal basis approached his landlord a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a new rent at the outset set at £100 per annum and doubled every 25 years thereafter. No ground rent would be due on a lease extension were Charlie to invoke his statutory right. Charlie obtained expert legal guidance and secured an acceptable deal without resorting to tribunal and readily saleable.
In 2014 we were approached by Mr Zachary Kelly who, having acquired a studio flat in Chesham in August 2005. We are asked if we could shed any light on how much (approximately) price could be for a ninety year lease extension. Identical residencies in Chesham with 100 year plus lease were valued around £225,400. The average amount of ground rent was £45 collected yearly. The lease finished in 2090. Considering the 64 years outstanding we estimated the premium to the freeholder to extend the lease to be between £15,200 and £17,600 not including fees.
In 2011 we were called by Ms Danielle Ward who, having was assigned a lease of a studio apartment in Chesham in February 1995. The question was if we could approximate the premium could be for a 90 year extension to my lease. Comparable properties in Chesham with a long lease were worth £270,000. The mid-range amount of ground rent was £55 collected monthly. The lease ended in 2101. Having 75 years remaining we calculated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 plus expenses.