Radcliffe 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. Legislation has been in place for sometime now which entitles qualifying Radcliffe residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Radcliffe you should check if your lease has between 70 and 90 years remaining. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
Leasehold properties in Radcliffe with in excess of 100 years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges justify 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 | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| Yorkshire 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. |
Regardless of whether you are a tenant or a landlord in Radcliffe,the lease extension solicitors 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 Radcliffe valuers.
Last year Tommy, came dangerously close to the 80-year threshold with the lease on his purpose- built apartment in Radcliffe. Having purchased his flat two decades ago, the length of the lease was of minimal concern. Thankfully, he noticed he needed to take steps soon on a lease extension. Tommy arranged for a lease extension just under the wire in August. Tommy and the landlord who owned the flat above in the end settled on an amount of £5,500 . If he had missed the deadline, the premium would have increased by at least £850.
In 2014 we were e-mailed by Mr and Mrs. C Taylor who, having acquired a one bedroom apartment in Radcliffe in July 2011. The question was if we could shed any light on how much (approximately) premium could be for a 90 year extension to my lease. Comparable flats in Radcliffe with a long lease were worth £200,000. The mid-range ground rent payable was £50 billed per annum. The lease finished on 28 November 2104. Given that there were 78 years outstanding we approximated the premium to the landlord for the lease extension to be between £8,600 and £9,800 exclusive of expenses.
Last Spring we were e-mailed by Mr and Mrs. S Rivera , who purchased a one bedroom apartment in Radcliffe in March 1999. We are asked if we could approximate the compensation to the landlord would likely be to prolong the lease by a further 90 years. Comparative flats in Radcliffe with an extended lease were worth £267,600. The average amount of ground rent was £65 collected per annum. The lease finished on 18 July 2093. Having 67 years left we estimated the compensation to the freeholder to extend the lease to be within £14,300 and £16,400 plus legals.