With a residential leasehold premises in Somersham, you effectively rent it for a certain amount of time. These days flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you should think about a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately more expensive notably once there are fewer than 80 years left. Leasehold owners in Somersham with a lease drawing near to 81 years remaining should seriously consider extending it sooner rather than later. When the lease term has less than eighty years outstanding, under the relevant statute the freeholder can calculate and demand a larger premium, based on a technical calculation, known as “marriage value” which is due.
It is conventional wisdom that a residential leasehold with over one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 30 years left, 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
Engaging our service gives you enhanced control over the value of your Somersham leasehold, as your property will be more valuable and saleable in relation to the lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Zachary was the the leasehold proprietor of a conversion apartment in Somersham being sold with a lease of just over 61 years outstanding. Zachary informally approached his landlord being a well known local-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years subject to a new rent initially set at £100 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Zachary to invoke his statutory right. Zachary obtained expert legal guidance and secured an acceptable deal informally and sell the property.
Last month we were approach by Dr Harry Dupont , who acquired a garden flat in Somersham in June 1998. The question was if we could shed any light on how much (approximately) premium would likely be for a 90 year extension to my lease. Comparable homes in Somersham with a long lease were valued about £174,200. The average amount of ground rent was £55 billed quarterly. The lease ended on 13 June 2076. Taking into account 51 years remaining we approximated the compensation to the landlord to extend the lease to be within £31,400 and £36,200 not including professional charges.
Mr E Edwards bought a purpose-built flat in Somersham in March 2002. We are asked if we could shed any light on how much (roughly) price would be for a 90 year lease extension. Similar residencies in Somersham with a long lease were worth £285,000. The average amount of ground rent was £45 invoiced monthly. The lease concluded on 26 July 2096. Considering the 71 years outstanding we calculated the premium to the freeholder for the lease extension to be between £12,400 and £14,200 not including costs.