Unfortunately that a Rowen residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the reduction being disguised by increases in the Rowen property market.Where your lease has approximately ninety years left, you should start thinking about a lease extension. If lease term slips under 80 years, you will then be required to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Rowen will be able to extend under the legislation; however a conveyancer will be able to clarify if you qualify for an extension. In some situations you may not qualify. There are also strict timeframes and procedures to follow once the process is instigated and you will need to be guided by your lawyer for the duration of the formalities.
Leasehold properties in Rowen with more than 100 years outstanding on the lease are sometimes regarded as a ‘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 freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Engaging our service will provide you increased control over the value of your Rowen leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Archie owned a high value flat in Rowen on the market with a lease of fraction over 61 years left. Archie on an informal basis spoke with his landlord a well known local-based freehold company for a lease extension. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £125 yearly. No ground rent would be payable on a lease extension were Archie to invoke his statutory right. Archie obtained expert advice and was able to make a more informed decision and handle with the matter and sell the property.
In 2009 we were phoned by Mr M López who, having acquired a basement flat in Rowen in April 2006. The question was if we could approximate the price would likely be to extend the lease by ninety years. Comparable homes in Rowen with an extended lease were valued about £223,400. The mid-range amount of ground rent was £60 invoiced monthly. The lease concluded in 2085. Having 59 years remaining we calculated the compensation to the landlord to extend the lease to be within £27,600 and £31,800 plus fees.
In 2014 we were approached by Ms O Brown who, having owned a studio flat in Rowen in June 1995. We are asked if we could estimate the premium would likely be for a ninety year extension to my lease. Comparable homes in Rowen with a long lease were in the region of £210,000. The average amount of ground rent was £50 collected annually. The lease ended in 2105. Given that there were 79 years left we approximated the compensation to the freeholder to extend the lease to be within £8,600 and £9,800 not including fees.