Leven leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. Legislation has been in place for sometime now which entitles qualifying Leven residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Leven you really ought to see if your lease has between 70 and 90 years left. There are good reasons why a Leven leaseholder with a lease having around 80 years left should take action to ensure that a lease extension is effected without delay
It is conventional wisdom that a property with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years remaining, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Chelsea 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 handle Leven 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 conveyancing solicitor we work with provide it.
Off the back of lengthy correspondence with the landlord of her studio flat in Leven, Alicia initiated the lease extension process as the 80 year deadline was rapidly approaching. The lease extension was concluded in August 2015. The landlord’s costs were restricted to a tad over 500 GBP.
Last year we were phoned by Mr and Mrs. L Robinson , who acquired a garden apartment in Leven in June 1998. The question was if we could shed any light on how much (approximately) price would likely be to extend the lease by 90 years. Comparable premises in Leven with an extended lease were worth £260,000. The average amount of ground rent was £50 collected every twelve months. The lease expired on 8 November 2099. Given that there were 73 years outstanding we approximated the premium to the landlord for the lease extension to be between £9,500 and £11,000 plus professional charges.
Last Christmas we were phoned by Mr and Mrs. V Gunderson , who was assigned a lease of a one bedroom flat in Leven in January 2012. We are asked if we could estimate the compensation to the landlord could be for a 90 year lease extension. Comparable residencies in Leven with 100 year plus lease were valued around £264,000. The mid-range ground rent payable was £60 billed monthly. The lease concluded in 2079. Considering the 53 years unexpired we estimated the premium to the freeholder for the lease extension to be between £37,100 and £42,800 plus legals.