There is no doubt about it a leasehold property in Runcorn is a wasting asset as a result of the shortening lease. If the lease has, in excess of 99 years to run then this decrease may be fractional that being said there will become a point in time when a lease has fewer than 80 years left as part of the premium you will incur is what is known as a marriage value. This could increase markedly the cost. It is the main rational as to why you should consider extending without delay. The majority of flat owners in Runcorn will qualify for this right; that being said a conveyancer can confirm if you are eligible for a lease extension. In limited situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold premises in Runcorn with in excess of 100 years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth 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 maintenance charges justify it.
| Lender | Requirement |
|---|---|
| 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 should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Chelsea 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. |
| 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. |
Using our service will provide you better control over the value of your Runcorn leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Reuben owned a high value apartment in Runcorn being sold with a lease of fraction over 59 years remaining. Reuben informally spoke with his landlord being a well known Bristol-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years subject to a rise in the rent to £200 annually. Ordinarily, ground rent would not be due on a lease extension were Reuben to exercise his statutory right. Reuben obtained expert legal guidance and was able to make an informed decision and handle with the matter and sell the property.
Last Summer we were phoned by Dr Nathan Thomas , who acquired a studio apartment in Runcorn in May 2006. The question was if we could estimate the price would likely be to extend the lease by an additional years. Identical premises in Runcorn with a long lease were in the region of £166,400. The average amount of ground rent was £60 collected per annum. The lease elapsed on 25 October 2080. Considering the 54 years remaining we estimated the premium to the landlord to extend the lease to be between £32,300 and £37,400 plus professional charges.
In 2010 we were called by Mr Luke Robinson who, having moved into a studio apartment in Runcorn in January 2008. The question was if we could shed any light on how much (approximately) price could be for a ninety year lease extension. Comparative residencies in Runcorn with 100 year plus lease were worth £227,800. The average amount of ground rent was £45 billed quarterly. The lease expiry date was on 8 July 2091. Taking into account 65 years remaining we approximated the compensation to the landlord for the lease extension to be between £13,300 and £15,400 exclusive of fees.