It’s a harsh truth that a Killamarsh residential lease is a wasting asset. As the lease term reduces so does the value of the property. 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 Killamarsh property market.Where your lease has approximately ninety years left, you need to 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 dips lower than eighty years - otherwise a higher premium will be payable. The majority of flat owners in Killamarsh will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify whether you qualify for an extension. In some cases you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancer from beginning to end of the formalities.
Leasehold premises in Killamarsh with in excess of one hundred years left 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 home. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges merit it.
| 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. |
| 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. |
| 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. |
Regardless of whether you are a tenant or a landlord in Killamarsh,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 Killamarsh valuers.
Ibrahim owned a studio flat in Killamarsh on the market with a lease of a few days over fifty eight years unexpired. Ibrahim on an informal basis spoke with his freeholder being a well known local-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 initially set at £150 per annum and increase every twenty five years thereafter. No ground rent would be payable on a lease extension were Ibrahim to exercise his statutory right. Ibrahim procured expert advice and was able to make a more informed decision and deal with the matter and sell the property.
Last year we were called by Mr Mason Díaz , who acquired a purpose-built flat in Killamarsh in July 2004. We are asked if we could estimate the price would likely be to extend the lease by a further 90 years. Identical residencies in Killamarsh with 100 year plus lease were valued about £285,000. The average ground rent payable was £45 invoiced yearly. The lease concluded on 18 May 2096. Considering the 71 years as a residual term we estimated the compensation to the freeholder for the lease extension to be within £12,400 and £14,200 exclusive of expenses.
Last Summer we were contacted by Ms O Torres , who was assigned a lease of a studio flat in Killamarsh in February 2011. The question was if we could approximate the price could be to extend the lease by a further 90 years. Comparative homes in Killamarsh with a long lease were in the region of £225,800. The mid-range ground rent payable was £60 collected quarterly. The lease came to a finish on 19 February 2085. Considering the 60 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £23,800 and £27,400 plus expenses.