It’s an underpublicised truth that a Newbridge residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the depreciation being disguised by increases in the Newbridge property market.Where your lease has approximately 90 years left, you should start thinking about a lease extension. If the number of years remaining falls under eighty years, you will end up paying 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property The majority of leasehold owners in Newbridge will be able to extend under the legislation; however a lawyer will be able to clarify whether you are eligibility. In some cases you may not qualify. There are also strict timetables and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer throughout the process.
It is generally accepted that a residential leasehold with over 100 years unexpired lease term 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 equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Leeds Building Society | 85 years remaining from the start 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Newbridge can be a difficult process. We recommend you get professional help 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 a wealth of experience procuring Newbridge lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In 2014 Isaac, started to get close to the eighty-year threshold with the lease on his studio apartment in Newbridge. In buying his property two decades ago, the unexpired term was of little interest. Thankfully, he recognised he needed to take steps soon on a lease extension. Isaac extended the lease just under the wire in January. Isaac and the landlord in the end settled on sum of £5,000 . If he not met the deadline, the figure would have increased by at least £850.
In 2013 we were contacted by Mr C Rose who, having completed a studio apartment in Newbridge in March 2010. The dilemma was if we could approximate the premium would likely be for a ninety year lease extension. Similar homes in Newbridge with a long lease were in the region of £235,200. The average amount of ground rent was £45 invoiced annually. The lease expiry date was in 2091. Having 66 years as a residual term we calculated the premium to the landlord for the lease extension to be within £12,400 and £14,200 plus legals.
Last Christmas we were called by Dr L Garcia , who owned a one bedroom apartment in Newbridge in July 2009. The dilemma was if we could approximate the premium would be to extend the lease by a further 90 years. Identical properties in Newbridge with a long lease were worth £275,000. The average ground rent payable was £55 billed per annum. The lease ended on 2 June 2102. Taking into account 77 years unexpired we approximated the premium to the landlord for the lease extension to be between £13,300 and £15,400 not including fees.