Rowen leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease gets more expensive. Legislation has been in place for sometime now which permits qualifying Rowen residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Rowen you should see if your lease has between 70 and 90 years left. In particular once the remaining lease term slips under eighty years, the cost of any lease extension increases dramatically as part of the premium you will incur is what is known as a marriage value
It is generally considered that a property with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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. |
| 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 |
Using our service gives you enhanced control over the value of your Rowen leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Trailing unsuccessful discussions with the landlord of her garden apartment in Rowen, Emily initiated the lease extension process as the eighty year mark was swiftly approaching. The legal work was finalised in July 2006. The landlord’s charges were negotiated to about 500 GBP.
Last June we were phoned by Ms Grace Sánchez , who completed a ground floor apartment in Rowen in March 2010. We are asked if we could approximate the premium could be to extend the lease by an additional years. Comparative premises in Rowen with a long lease were in the region of £205,000. The mid-range ground rent payable was £50 invoiced annually. The lease termination date was in 2104. Given that there were 78 years unexpired we calculated the compensation to the landlord for the lease extension to be within £7,600 and £8,800 plus professional charges.
Mr and Mrs. E Lewis owned a one bedroom flat in Rowen in April 1997. The question was if we could estimate the premium would be to extend the lease by an additional years. Identical premises in Rowen with 100 year plus lease were valued about £267,600. The mid-range ground rent payable was £65 collected annually. The lease lapsed in 2093. Given that there were 67 years unexpired we estimated the compensation to the freeholder for the lease extension to be within £14,300 and £16,400 plus professional charges.