Princes Risborough leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. Legislation has been in place for sometime now which permits qualifying Princes Risborough residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Princes Risborough you really ought to check if your lease has between seventy and 90 years left. There are good reasons why a Princes Risborough flat owner with a lease having around eighty years unexpired should take steps to ensure that a lease extension is actioned without delay
Leasehold premises in Princes Risborough with more than one hundred years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with undertake Princes Risborough 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.
In recent months Kyle, started to get close to the 80-year mark with the lease on his leasehold flat in Princes Risborough. In buying his flat twenty years previously, the lease term was of little significance. Luckily, he recognised he needed to take steps soon on a lease extension. Kyle extended the lease just under the wire last April. Kyle and the landlord who owned the flat above subsequently settled on an amount of £6,000 . If he had missed the deadline, the premium would have escalated by a minimum £1,025.
In 2011 we were e-mailed by Ms E Green who, having purchased a studio apartment in Princes Risborough in October 1998. The dilemma was if we could estimate the premium could be for a 90 year extension to my lease. Similar homes in Princes Risborough with 100 year plus lease were in the region of £168,800. The average amount of ground rent was £60 collected per annum. The lease lapsed in 2080. Taking into account 55 years as a residual term we calculated the compensation to the freeholder for the lease extension to be between £30,400 and £35,200 not including costs.
In 2011 we were phoned by Dr Leo Harris who, having owned a one bedroom apartment in Princes Risborough in September 1998. The dilemma was if we could estimate the price would likely be to extend the lease by ninety years. Comparable properties in Princes Risborough with 100 year plus lease were valued around £235,200. The mid-range ground rent payable was £45 billed yearly. The lease came to a finish on 5 February 2091. Having 66 years unexpired we estimated the compensation to the landlord to extend the lease to be between £12,400 and £14,200 exclusive of costs.