It’s a harsh truth that a Great Baddow residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the loss of value being disguised by increases in the Great Baddow property prices.Where your lease has approximately 90 years left, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips lower than eighty years - otherwise a higher premium will be payable. The majority of flat owners in Great Baddow will be able to extend under the legislation; however a lawyer should be able to clarify if you qualify for an extension. In some cases you may not be entitled. There are also strict deadlines and procedures to follow once the process is initiated and you will need to be guided by your conveyancing solicitor throughout the process.
Leasehold residencies in Great Baddow with over one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Coventry Building Society | 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service gives you enhanced control over the value of your Great Baddow leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of lengthy correspondence with the freeholder of her first floor flat in Great Baddow, Elizabeth initiated the lease extension process as the eighty year mark was rapidly coming. The lease extension completed in March 2007. The landlord’s charges were restricted to approximately 700 pounds.
In 2014 we were phoned by Mr and Mrs. S Brooks who, having purchased a basement apartment in Great Baddow in April 2006. We are asked if we could approximate the price would be for a 90 year extension to my lease. Comparable premises in Great Baddow with a long lease were worth £275,000. The mid-range amount of ground rent was £55 collected per annum. The lease expiry date was in 2102. Considering the 76 years as a residual term we approximated the premium to the landlord to extend the lease to be within £9,500 and £11,000 exclusive of legals.
In 2013 we were approached by Dr Henry Mitchell who, having took over the lease of a first floor flat in Great Baddow in July 1996. We are asked if we could estimate the compensation to the landlord could be for a ninety year extension to my lease. Identical residencies in Great Baddow with 100 year plus lease were in the region of £176,200. The average amount of ground rent was £65 billed per annum. The lease expired on 18 January 2082. Given that there were 56 years remaining we approximated the compensation to the freeholder to extend the lease to be within £29,500 and £34,000 exclusive of professional charges.