Somersham leases on residential properties are gradually losing value. Where your lease has in the region of 90 years unexpired, you should start thinking about a lease extension. An important point to note is that it is financially advisable for the lease extension to be in place before the term of the current lease drops under 80 years - otherwise a higher premium will be due. Flat owners in Somersham will usually be legally entitled to a lease extension; however it’s a good idea to check with a lawyer to check your eligibility. In certain circumstances you may not qualify. There are prescribed deadlines and procedures to comply with once the process has commenced so it’s prudent to be guided by a conveyancer during the process.
It is generally accepted that a residential leasehold with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to any lease with more than 45 years unexpired, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you increased control over the value of your Somersham leasehold, as your property will be more valuable and marketable 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.
Off the back of unsuccessful correspondence with the freeholder of her first floor flat in Somersham, Jade initiated the lease extension process just as her lease was nearing the all-important 80-year threshold. The transaction completed in March 2014. The freeholder’s costs were negotiated to under 450 GBP.
Last Summer we were called by Mr and Mrs. M García , who took over the lease of a newly refurbished apartment in Somersham in March 1997. The dilemma was if we could approximate the price could be to extend the lease by 90 years. Comparative properties in Somersham with 100 year plus lease were worth £189,000. The mid-range ground rent payable was £55 billed monthly. The lease termination date was in 2079. Considering the 53 years unexpired we calculated the compensation to the landlord for the lease extension to be between £28,500 and £33,000 not including fees.
Mr and Mrs. B López owned a purpose-built apartment in Somersham in September 1997. We are asked if we could estimate the compensation to the landlord would likely be to prolong the lease by 90 years. Identical flats in Somersham with a long lease were in the region of £290,000. The average ground rent payable was £45 collected per annum. The lease came to a finish on 19 August 2099. Considering the 73 years outstanding we approximated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 exclusive of legals.