Unfortunately that a Parkstone residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the Parkstone property market.Where your lease has approximately 90 years left, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls lower than eighty years - otherwise a higher premium will be due. Most flat owners in Parkstone will be able to extend under the legislation; however a conveyancer will be able to clarify if you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer from beginning to end of the formalities.
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth approximately the equivalent 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Retaining our service gives you enhanced control over the value of your Parkstone leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last year Ryan, came dangerously close to the eighty-year mark with the lease on his leasehold apartment in Parkstone. Having purchased his home 18 years previously, the lease term was of little concern. by good luck, he recognised he needed to take steps soon on a lease extension. Ryan was able to extend his lease just under the wire in June. Ryan and the freeholder subsequently agreed on an amount of £5,500 . If the lease had gone to less than 80 years, the amount would have increased by at least £1,000.
Last April we were called by Mr Hunter Edwards , who moved into a basement apartment in Parkstone in May 1997. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be for a ninety year lease extension. Comparative premises in Parkstone with an extended lease were in the region of £183,600. The mid-range amount of ground rent was £65 invoiced annually. The lease ran out in 2082. Given that there were 57 years remaining we approximated the compensation to the freeholder to extend the lease to be within £28,500 and £33,000 not including costs.
In 2010 we were contacted by Mrs O Patel who, having moved into a recently refurbished flat in Parkstone in August 2008. We are asked if we could estimate the compensation to the landlord would be for a 90 year lease extension. Similar residencies in Parkstone with an extended lease were worth £245,000. The average ground rent payable was £50 billed yearly. The lease elapsed in 2093. Considering the 68 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 not including costs.