Derby leases on residential properties are gradually losing value. if your lease has approximately 90 years unexpired, you should start considering the need for a lease extension. An important point to note is that it is desirable for your lease extension to take place before the term of the existing lease drops below 80 years - otherwise a higher premium will be payable. Flat owners in Derby will mostly qualify for a lease extension; however it’s a good idea to check with a conveyancing solicitor to confirm if you qualify. In certain circumstances you may not qualify. There are prescribed deadlines and steps to follow once the process has started so it’s prudent to be guided by a conveyancer during the process.
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with handle Derby 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 protracted discussions with the freeholder of her basement flat in Derby, Phoebe initiated the lease extension process just as the lease was coming close to the critical 80-year mark. The legal work completed in August 2008. The landlord’s charges were kept to an absolute minimum.
Last Winter we were phoned by Mr Hugo Parker , who acquired a basement apartment in Derby in April 2010. The dilemma was if we could estimate the price would be to prolong the lease by 90 years. Similar properties in Derby with a long lease were in the region of £232,800. The average amount of ground rent was £45 collected every twelve months. The lease terminated in 2091. Considering the 65 years unexpired we calculated the premium to the freeholder to extend the lease to be between £13,300 and £15,400 not including professional charges.
In 2011 we were contacted by Mrs Robyn Cox who, having purchased a studio flat in Derby in August 1997. We are asked if we could estimate the compensation to the landlord would be to prolong the lease by an additional years. Similar residencies in Derby with a long lease were valued about £275,000. The mid-range ground rent payable was £55 billed every twelve months. The lease termination date was in 2102. Considering the 76 years left we calculated the premium to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of fees.