Owning a flat usually means owning a lease of the property, which has a set term of years. This lease will ordinarily be granted for a prescribed period of time , usually 99 or 125 years, although we have seen longer and shorter terms in Jarrow. Clearly, the term of lease left reduces over time. This may pass by relatively unnoticed when the flat or house has to be disposed of or refinanced. The shorter the lease the less it is worth and the more expensive it will be to obtain a lease extension. Qualifying leaseholders in Jarrow have the right to extend the lease for an additional 90 years under the 1993 Leasehold Reform Act. Please give due deliberation before delaying your Jarrow lease extension. Putting off the cost now only increases the price you will ultimately have to pay for a lease extension
Leasehold premises in Jarrow with in excess of 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Lease extensions in Jarrow can be a difficult process. We recommend you obtain professional help from a conveyancing solicitor and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Jarrow lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Two years ago Jamie, came dangerously close to the eighty-year mark with the lease on his basement apartment in Jarrow. In buying his home two decades ago, the unexpired term was of minimal interest. Luckily, he became aware that he needed to take steps soon on a lease extension. Jamie arranged for a lease extension just ahead of time in March. Jamie and the landlord who owned the flat above in the end agreed on sum of £6,000 . If the lease had dropped lower than eighty years, the figure would have increased by at least £1,025.
Last Christmas we were phoned by Ms W Ramírez , who acquired a ground floor flat in Jarrow in October 2006. The question was if we could estimate the price would be for a 90 year extension to my lease. Comparative properties in Jarrow with an extended lease were valued about £275,000. The average amount of ground rent was £55 collected per annum. The lease lapsed on 3 June 2101. Having 76 years left we approximated the premium to the landlord for the lease extension to be between £9,500 and £11,000 exclusive of legals.
In 2012 we were phoned by Mr and Mrs. P Parker who, having acquired a first floor flat in Jarrow in March 2002. We are asked if we could shed any light on how much (approximately) premium could be to extend the lease by ninety years. Comparable properties in Jarrow with an extended lease were valued around £176,200. The average amount of ground rent was £65 collected per annum. The lease ran out in 2081. Taking into account 56 years as a residual term we estimated the compensation to the landlord to extend the lease to be within £29,500 and £34,000 not including professional charges.