Highnam leases on domestic deteriorating in value. Where your lease has about ninety years left, you should start considering the need for a lease extension. 80 years is a significant number: when the unexpired term of a lease dips below this level then you start incurring an additional element called marriage value. Leasehold owners in Highnam will usually qualify for a lease extension; however a solicitor will check your eligibility. In certain situations you may not be entitled. There are also strict deadlines and steps to comply with once the process has started so it’s prudent to be guided by a conveyancer during the process.
It is generally considered that a residential leasehold with in excess of one hundred years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
| 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 |
Regardless of whether you are a tenant or a landlord in Highnam,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Highnam valuers.
Luca owned a high value flat in Highnam on the market with a lease of just over 61 years unexpired. Luca informally spoke with his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent to start with set at £200 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Luca to invoke his statutory right. Luca procured expert advice and was able to make an informed decision and deal with the matter and ending up with a market value flat.
Last Christmas we were approach by Ms Courtney Wright , who bought a purpose-built flat in Highnam in April 2001. The question was if we could estimate the price could be for a 90 year extension to my lease. Comparative properties in Highnam with 100 year plus lease were in the region of £191,400. The mid-range ground rent payable was £55 invoiced per annum. The lease ran out in 2080. Having 54 years as a residual term we estimated the compensation to the landlord for the lease extension to be between £34,200 and £39,600 exclusive of costs.
In 2014 we were called by Dr Riley Brown who, having completed a one bedroom flat in Highnam in January 2010. The question was if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Similar properties in Highnam with 100 year plus lease were worth £295,000. The mid-range ground rent payable was £45 collected yearly. The lease expired in 2100. Considering the 74 years remaining we approximated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 plus expenses.