With a residential leasehold premises in Flint, you are actually buying a right to reside in a property for a prescribed time frame. These days flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you should consider a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately more expensive notably when there are less than 80 years remaining. Residents in Flint with a lease approaching 81 years unexpired should seriously consider extending it as soon as possible. Once a lease has below 80 years outstanding, under the current statute the landlord can calculate and demand a greater premium, assessed on a technical calculation, known as “marriage value” which is due.
Leasehold residencies in Flint with over 100 years remaining 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 home. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges merit it.
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with undertake Flint 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.
Trailing unsuccessful negotiations with the landlord of her ground floor flat in Flint, Bethan commenced the lease extension process as the eighty year deadline was swiftly coming. The lease extension completed in April 2006. The landlord’s charges were kept to an absolute minimum.
Last Christmas we were e-mailed by Dr V Jones , who owned a basement apartment in Flint in September 2001. We are asked if we could approximate the price could be for a 90 year extension to my lease. Comparative properties in Flint with an extended lease were valued about £250,000. The average amount of ground rent was £50 invoiced annually. The lease terminated on 15 July 2094. Given that there were 69 years remaining we approximated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 not including expenses.
In 2012 we were approached by Mr and Mrs. W Carter who, having completed a first floor flat in Flint in September 2005. We are asked if we could estimate the premium would be to prolong the lease by an additional years. Comparative premises in Flint with an extended lease were in the region of £285,000. The average amount of ground rent was £55 invoiced every twelve months. The lease terminated on 8 March 2105. Having 80 years left we calculated the premium to the landlord for the lease extension to be between £12,400 and £14,200 exclusive of costs.