Penshaw leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. The majority of owners of residential leasehold property in Penshaw enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Penshaw you must check if your lease has between seventy and ninety years left. There are compelling reasons why a Penshaw flat owner with a lease having around 80 years remaining should take steps to make sure that a lease extension is put in place without delay
It is generally accepted that a property with over 100 years remaining is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| 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. |
The conveyancing solicitors that we work with undertake Penshaw 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.
Callum was the the leasehold owner of a conversion flat in Penshaw on the market with a lease of just over 72 years left. Callum on an informal basis contacted his freeholder being a well known Bristol-based freehold company for a lease extension. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent to start with set at £100 per annum and increase every 25 years thereafter. No ground rent would be due on a lease extension were Callum to invoke his statutory right. Callum procured expert legal guidance and was able to make a more informed judgement and deal with the matter and sell the property.
Last month we were phoned by Dr B Wright , who was assigned a lease of a recently refurbished apartment in Penshaw in March 2008. The question was if we could estimate the price could be to prolong the lease by a further 90 years. Identical premises in Penshaw with an extended lease were valued about £256,600. The mid-range amount of ground rent was £60 invoiced per annum. The lease ended on 2 April 2077. Given that there were 52 years remaining we calculated the compensation to the landlord for the lease extension to be between £41,800 and £48,400 plus fees.
In 2014 we were e-mailed by Dr Archie Collins who, having acquired a basement apartment in Penshaw in March 2011. The question was if we could approximate the price would be to extend the lease by an additional years. Identical premises in Penshaw with an extended lease were worth £218,000. The average amount of ground rent was £45 billed yearly. The lease came to a finish on 5 June 2088. Given that there were 63 years outstanding we calculated the compensation to the freeholder to extend the lease to be within £17,100 and £19,800 not including costs.