When it comes to residential leasehold premises in Fenstanton, you are actually buying a right to live in a property for a set period of time. These days flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you should consider extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease gets disproportionately more expensive especially when there are less than eighty years remaining. Leasehold owners in Fenstanton with a lease approaching 81 years unexpired should seriously consider extending it sooner than later. When the lease term has below 80 years left, under the current statute the freeholder is entitled to calculate and charge a larger premium, based on a technical calculation, strangely termed as “marriage value” which is payable.
It is generally accepted that a residential leasehold with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 35 years unexpired, the property will be equivalent in value to a freehold for decades to come.
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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 |
| Yorkshire 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. |
Irrespective of whether you are a tenant or a landlord in Fenstanton,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Fenstanton valuers.
Kyle owned a 2 bedroom apartment in Fenstanton being marketed with a lease of fraction over sixty years outstanding. Kyle informally spoke with his freeholder a well known London-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years subject to an increased rent to £100 yearly. No ground rent would be due on a lease extension were Kyle to exercise his statutory right. Kyle obtained expert legal guidance and secured an acceptable deal without resorting to tribunal and ending up with a market value flat.
Last month we were approach by Mrs R Girard , who bought a recently refurbished flat in Fenstanton in January 2003. We are asked if we could approximate the price could be for a ninety year lease extension. Comparative premises in Fenstanton with an extended lease were in the region of £255,000. The mid-range ground rent payable was £50 invoiced every twelve months. The lease lapsed on 28 June 2094. Given that there were 70 years as a residual term we estimated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of professional charges.
Last Spring we were contacted by Mr and Mrs. I Simon , who took over the lease of a one bedroom flat in Fenstanton in May 2000. The dilemma was if we could shed any light on how much (approximately) premium could be for a 90 year extension to my lease. Comparable properties in Fenstanton with a long lease were in the region of £246,800. The mid-range amount of ground rent was £60 billed quarterly. The lease came to a finish on 3 May 2074. Taking into account 50 years as a residual term we estimated the compensation to the landlord for the lease extension to be between £44,700 and £51,600 exclusive of fees.