It’s a harsh truth that a Highnam residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the Highnam property market.Once your lease gets to 85ish years, you should start thinking about a lease extension. If the number of years remaining drops below eighty years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Highnam will be able to extend under the legislation; however a lawyer should be able to confirm whether you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer from beginning to end of the process.
Leasehold residencies in Highnam with in excess of 100 years unexpired 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 situations there is often little to be gained by buying the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 |
Irrespective of whether you are a tenant or a landlord in Highnam,the lease extension experts 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.
Last October Riley, started to get near to the 80-year threshold with the lease on his one bedroom flat in Highnam. Having bought his home 19 years previously, the unexpired term was of little interest. As luck would have it, he became aware that he needed to take steps soon on Extending the lease. Riley extended the lease just under the wire last April. Riley and the freeholder via the managing agents in the end settled on an amount of £5,000 . If he failed to meet the deadline, the figure would have gone up by at least £1,125.
Dr Francesca Mason was assigned a lease of a one bedroom flat in Highnam in July 1996. The dilemma was if we could approximate the compensation to the landlord would be for a 90 year extension to my lease. Comparable homes in Highnam with 100 year plus lease were worth £250,400. The average amount of ground rent was £65 invoiced every twelve months. The lease elapsed in 2089. Given that there were 64 years remaining we approximated the premium to the landlord for the lease extension to be between £19,000 and £22,000 exclusive of legals.
Last month we were called by Mrs U Gray , who was assigned a lease of a basement flat in Highnam in March 1995. We are asked if we could estimate the premium would likely be for a ninety year lease extension. Comparative premises in Highnam with 100 year plus lease were worth £189,000. The mid-range ground rent payable was £55 invoiced per annum. The lease terminated in 2078. Taking into account 53 years outstanding we calculated the compensation to the freeholder for the lease extension to be within £28,500 and £33,000 exclusive of legals.