Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will normally be granted for a set period of time , usually 99 or 125 years, although we have seen longer and shorter terms in Langley. Clearly, the length of lease left reduces as time goes by. This is often overlooked and only raises itself as an issue when the property has to be disposed of or re-mortgaged. The shorter the lease the lower the value of the property and the more expensive it will be to extend the lease. Eligible long lease owners in Langley have the legal entitlement to extend the lease for an additional 90 years under statute. You should give due deliberation before putting off your Langley lease extension. Holding off the cost now simply increases the price you will eventually have to pay to extend your lease
Leasehold residencies in Langley with in excess of 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value 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 |
|---|---|
| Bank of Scotland | 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
The conveyancing solicitors that we work with undertake Langley lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
During the course of the last few months Thomas, started to get near to the eighty-year threshold with the lease on his basement flat in Langley. In buying his property two decades ago, the unexpired term was of little significance. Fortunately, he realised he needed to take steps soon on a lease extension. Thomas was able to extend his lease just under the wire in July. Thomas and the freeholder subsequently settled on an amount of £5,000 . If the lease had fallen below 80 years, the figure would have gone up by a minimum £925.
In 2012 we were contacted by Ms R Harris who, having owned a one bedroom flat in Langley in June 1999. The question was if we could estimate the premium would be for a ninety year extension to my lease. Comparable flats in Langley with 100 year plus lease were valued around £285,000. The average amount of ground rent was £45 collected every twelve months. The lease end date was on 22 August 2096. Having 71 years outstanding we calculated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 not including costs.
An example of a Freehold Enfranchisement decision for a Langley premises is 164 Nestles Avenue in October 2013. The tribunal agreed with the proposed price of £20,158 for the freehold and determined that that sum is the amount to be paid into court This case was in relation to 2 flats. The unexpired term was 69 years.