Ladywood leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. The majority of owners of residential leasehold property in Ladywood enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Ladywood you really ought to check if your lease has between seventy and 90 years left. There are compelling reasons why a Ladywood leaseholder with a lease having around 80 years unexpired should take action to ensure that a lease extension is effected without delay
It is generally accepted that a property with in excess of one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the residence 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. |
| 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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. |
Lease extensions in Ladywood can be a difficult process. We recommend you secure guidance from a lawyer and valuer well versed in the legislation and lease extension process.
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 in-depth market knowledge procuring Ladywood lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last year Jasper, came precariously close to the 80-year threshold with the lease on his garden flat in Ladywood. Having bought his home two decades ago, the lease term was of little importance. Luckily, he noticed he would soon be paying an inflated amount for a lease extension. Jasper was able to extend his lease just in the nick of time in September. Jasper and the freeholder ultimately settled on sum of £5,500 . If the lease had gone lower than 80 years, the amount would have escalated by at least £900.
Dr Sophia Edwards took over the lease of a basement flat in Ladywood in April 1996. We are asked if we could approximate the compensation to the landlord would be to extend the lease by a further 90 years. Comparable properties in Ladywood with an extended lease were worth £275,000. The mid-range ground rent payable was £55 billed quarterly. The lease concluded on 8 May 2102. Given that there were 76 years unexpired we estimated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 plus professional charges.
Last Winter we were called by Mrs R Moore , who took over the lease of a ground floor flat in Ladywood in September 2006. We are asked if we could approximate the premium would be to prolong the lease by ninety years. Identical flats in Ladywood with 100 year plus lease were worth £176,200. The mid-range ground rent payable was £65 collected monthly. The lease terminated in 2082. Taking into account 56 years remaining we calculated the premium to the freeholder for the lease extension to be between £29,500 and £34,000 not including costs.