Owning a apartment usually means owning a lease of the property, which has a finite term of years. This lease will normally be granted for a set period of time , usually 99 or 125 years, although we have seen longer and shorter terms in Pratt's Bottom. Clearly, the period of lease remaining shortens as time goes by. This is often ignored and only raises itself as an issue when the residence needs to be sold or re-mortgaged. The shorter the lease the lower the value of the property and the more expensive it will be to extend the lease. Eligible leaseholders in Pratt's Bottom have the legal entitlement to extend the lease for a further 90 years under the 1993 Leasehold Reform Act. You should give careful attention before putting off your Pratt's Bottom lease extension. Putting off the cost now simply increases the price you will ultimately have to pay for a lease extension
It is conventional wisdom that a residential leasehold with over one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence 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 should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with handle Pratt's Bottom 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 conveyancer we work with provide it.
Max was the the leasehold proprietor of a studio apartment in Pratt's Bottom being sold with a lease of fraction over 72 years remaining. Max informally approached his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent initially set at £200 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Max to exercise his statutory right. Max obtained expert legal guidance and was able to make an informed decision and deal with the matter and readily saleable.
Mr Hunter Rose moved into a first floor flat in Pratt's Bottom in October 2004. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would be for a ninety year extension to my lease. Similar residencies in Pratt's Bottom with an extended lease were in the region of £285,000. The mid-range ground rent payable was £45 invoiced yearly. The lease concluded on 17 July 2097. Considering the 72 years remaining we calculated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 plus professional charges.
An example of a Lease Extension matter before the tribunal for a Pratt's Bottom premises is 1 Southlands Court Southlands Road in September 2013. The Leasehold Valuation Tribunal determined that the premium to be paid by the tenant on the grant of a new lease, in accordance with section 56 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 was £30,541 This case was in relation to 1 flat. The number of years remaining on the existing lease(s) was 50.57 years.