Grasmere leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. Legislation has been in place for sometime now which entitles qualifying Grasmere residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Grasmere you should check if your lease has between 70 and 90 years left. There are good reasons why a Grasmere leaseholder with a lease having around eighty years left should take action to ensure that a lease extension is put in place without delay
Leasehold residencies in Grasmere with more than one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges justify it.
| 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Regardless of whether you are a tenant or a freeholder in Grasmere,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Grasmere valuers.
In 2014 Reuben, started to get near to the eighty-year mark with the lease on his leasehold apartment in Grasmere. In buying his home two decades ago, the lease term was of minimal bearing. As luck would have it, he became aware that he needed to take steps soon on a lease extension. Reuben extended the lease at the eleventh hour last June. Reuben and the freeholder in the end settled on a premium of £5,000 . If he had missed the deadline, the sum would have gone up by a minimum £900.
In 2011 we were contacted by Ms L Turner who, having moved into a purpose-built flat in Grasmere in March 1995. We are asked if we could approximate the price could be to prolong the lease by an additional years. Comparative premises in Grasmere with an extended lease were valued about £181,600. The average ground rent payable was £55 collected quarterly. The lease terminated on 4 January 2076. Considering the 52 years unexpired we approximated the compensation to the landlord for the lease extension to be within £30,400 and £35,200 exclusive of expenses.
Mr and Mrs. N Wood purchased a one bedroom flat in Grasmere in October 2011. The dilemma was if we could estimate the compensation to the landlord would be for a ninety year extension to my lease. Similar residencies in Grasmere with an extended lease were valued around £290,000. The mid-range ground rent payable was £45 collected annually. The lease ran out on 21 October 2096. Having 72 years outstanding we calculated the compensation to the freeholder to extend the lease to be within £11,400 and £13,200 plus expenses.