Highnam leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Highnam residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Highnam you would be well advised to investigate if your lease has between seventy and 90 years remaining. There are compelling reasons why a Highnam flat owner with a lease having around 80 years remaining should take action to ensure that a lease extension is actioned without delay
It is generally considered that a property with more than one hundred years remaining is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 35 years remaining, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service gives you enhanced control over the value of your Highnam leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Twenty four months ago Eli, started to get near to the eighty-year threshold with the lease on his purpose- built flat in Highnam. Having bought his flat twenty years ago, the lease term was of no importance. As luck would have it, he noticed he would imminently be paying an inflated amount for a lease extension. Eli was able to extend his lease just under the wire in April. Eli and the freeholder via the management company subsequently agreed on the final figure of £6,000 . If he failed to meet the deadline, the price would have increased by a minimum £900.
Last February we were e-mailed by Dr J André , who moved into a one bedroom apartment in Highnam in May 2007. The question was if we could shed any light on how much (approximately) premium would likely be to prolong the lease by ninety years. Identical properties in Highnam with a long lease were in the region of £300,000. The mid-range ground rent payable was £50 invoiced quarterly. The lease ran out on 10 June 2101. Having 76 years left we estimated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 plus expenses.
In 2010 we were contacted by Mrs F Lefèvre who, having took over the lease of a one bedroom apartment in Highnam in September 2011. We are asked if we could approximate the price would be for a ninety year lease extension. Identical premises in Highnam with a long lease were in the region of £257,800. The average ground rent payable was £65 billed per annum. The lease came to a finish on 23 July 2090. Having 65 years unexpired we approximated the premium to the freeholder to extend the lease to be within £18,100 and £20,800 plus costs.