With a long leasehold property in Newbridge, you are actually buying a right to reside in a property for a set period of time. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you may think about a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly especially when there are less than eighty years remaining. Residents in Newbridge with a lease approaching 81 years left should seriously think of extending it sooner rather than later. Once a lease has under 80 years left, under the relevant legislation the freeholder is entitled to calculate and demand a larger amount, based on a technical calculation, strangely termed as “marriage value” which is payable.
Leasehold premises in Newbridge with in excess of 100 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 premises. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a freeholder in Newbridge,the lease extension lawyers 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 Newbridge valuers.
After unsuccessful negotiations with the landlord of her two bedroom apartment in Newbridge, Rachel initiated the lease extension process just as the lease was coming close to the all-important 80-year mark. The lease extension was finalised in March 2013. The freeholder’s fees were kept to an absolute minimum.
Ms U Bonnet completed a one bedroom flat in Newbridge in February 2010. The dilemma was if we could estimate the premium could be to prolong the lease by 90 years. Comparable residencies in Newbridge with an extended lease were valued about £255,000. The average ground rent payable was £50 invoiced quarterly. The lease expired in 2097. Considering the 71 years left we approximated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 not including legals.
In 2013 we were called by Ms Lucy Jones who, having took over the lease of a garden flat in Newbridge in April 2000. The question was if we could shed any light on how much (approximately) premium could be to prolong the lease by an additional years. Similar flats in Newbridge with 100 year plus lease were valued about £254,200. The mid-range ground rent payable was £60 billed yearly. The lease ran out in 2077. Having 51 years outstanding we approximated the compensation to the freeholder to extend the lease to be within £43,700 and £50,600 exclusive of fees.