Flitwick leases on domestic properties are gradually losing value. if your lease has approximately ninety years left, you should start thinking about a lease extension. If lease term dips under 80 years, you will then have to pay half of the property's 'marriage value' on top of the standard cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Flat owners in Flitwick will usually qualify for a lease extension; however It would be wise to check with a lawyer to check if you qualify. In some circumstances you may not qualify. There are also strict deadlines and procedures to follow once the process has commenced so it’s prudent to be guided by a lawyer during the process.
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Lloyds TSB Scotland | 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. |
The conveyancers that we work with handle Flitwick 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.
Last year Matthew, came critically near to the 80-year threshold with the lease on his basement flat in Flitwick. In buying his home 18 years previously, the lease term was of no relevance. Thankfully, he noticed he needed to take action soon on a lease extension. Matthew arranged for a lease extension at the eleventh hour in July. Matthew and the freeholder via the management company in the end settled on an amount of £5,000 . If he failed to meet the deadline, the premium would have gone up by a minimum £900.
Last Christmas we were e-mailed by Ms J Hill , who completed a ground floor flat in Flitwick in July 2012. We are asked if we could shed any light on how much (approximately) premium would be for a 90 year lease extension. Comparable residencies in Flitwick with 100 year plus lease were valued around £295,000. The mid-range amount of ground rent was £45 collected per annum. The lease came to a finish in 2100. Taking into account 74 years as a residual term we estimated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 plus fees.
Last month we were phoned by Dr Jade Baker , who purchased a ground floor flat in Flitwick in October 1998. The question was if we could estimate the premium would be to extend the lease by ninety years. Similar premises in Flitwick with 100 year plus lease were valued around £243,000. The average ground rent payable was £65 collected per annum. The lease end date was in 2089. Considering the 63 years left we estimated the premium to the landlord for the lease extension to be within £20,000 and £23,000 not including fees.