Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will normally be granted for a fixed period of time , usually 99 or 125 years, although we have seen longer and shorter terms in Repton. Clearly, the term of lease left shortens as time goes by. This may slip by relatively unnoticed when the flat or house has to be sold or re-mortgaged. The fewer the years remaining the less it is worth and the more it will cost to extend the lease. Qualifying long lease owners in Repton have the legal entitlement to extend the lease for an additional 90 years under statute. You should give due attention before delaying your Repton lease extension. Holding off the cost now simply increases the price you will ultimately incur to extend your lease
It is generally accepted that a property with in excess of 100 years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Regardless of whether you are a tenant or a freeholder in Repton,the lease extension lawyers 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 Repton valuers.
Owen owned a conversion flat in Repton on the market with a lease of a little over 72 years remaining. Owen on an informal basis spoke with his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £150 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Owen to exercise his statutory right. Owen obtained expert legal guidance and secured an acceptable deal informally and readily saleable.
Mr O Khan owned a studio apartment in Repton in February 1998. We are asked if we could shed any light on how much (roughly) premium would likely be to extend the lease by a further 90 years. Comparative flats in Repton with 100 year plus lease were valued around £218,000. The mid-range ground rent payable was £45 invoiced per annum. The lease ran out in 2089. Given that there were 63 years outstanding we approximated the premium to the freeholder for the lease extension to be between £17,100 and £19,800 plus expenses.
Last Winter we were e-mailed by Mr M Martinez , who completed a studio flat in Repton in March 2009. The dilemma was if we could shed any light on how much (approximately) price would be for a ninety year extension to my lease. Comparative properties in Repton with a long lease were valued about £265,000. The average ground rent payable was £55 invoiced yearly. The lease lapsed in 2100. Taking into account 74 years remaining we approximated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 not including expenses.