Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will ordinarily be granted for a set period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Crosby. Clearly, the period of lease remaining shortens as time goes by. This is often ignored and only raises itself as an issue when the flat or house has to be sold or re-mortgaged. The fewer the years remaining the lower the value of the property and the more expensive it will be to procure a lease extension. Qualifying long lease owners in Crosby have the legal entitlement to extend the lease for an additional 90 years in accordance with statute. You should give due attention before delaying your Crosby lease extension. Holding off that expense now likely increases the price you will eventually incur to extend your lease
It is conventional wisdom that a property with more than one hundred years remaining is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 35 years left, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Crosby,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 Crosby valuers.
Leon owned a 2 bedroom apartment in Crosby being marketed with a lease of fraction over 72 years left. Leon on an informal basis approached his landlord being 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 an increased rent to £125 per annum. Ordinarily, ground rent would not be payable on a lease extension were Leon to invoke his statutory right. Leon procured expert legal guidance and secured an acceptable resolution without going to tribunal and readily saleable.
Dr Y Moreau moved into a ground floor apartment in Crosby in May 2002. The dilemma was if we could estimate the price could be to extend the lease by ninety years. Comparative properties in Crosby with 100 year plus lease were worth £260,200. The average ground rent payable was £65 collected quarterly. The lease finished in 2091. Taking into account 66 years outstanding we calculated the premium to the landlord to extend the lease to be within £15,200 and £17,600 exclusive of professional charges.
Dr C Gray bought a one bedroom apartment in Crosby in September 2004. We are asked if we could approximate the compensation to the landlord could be to extend the lease by an additional years. Comparable residencies in Crosby with an extended lease were in the region of £198,800. The average amount of ground rent was £55 collected per annum. The lease expired in 2080. Taking into account 55 years outstanding we calculated the compensation to the landlord to extend the lease to be between £33,300 and £38,400 exclusive of legals.