Unfortunately that a Thornbury residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the Thornbury property market.Once your lease nears 85ish years, you need to start considering a lease extension. If the number of years remaining falls below 80 years, you will end up paying 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 leasehold owners in Thornbury will be able to extend under the legislation; however a conveyancer should be able to clarify if you are eligibility. In some situations you may not qualify. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer throughout the formalities.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 30 years left, the residence will be worth the same as 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
Lease extensions in Thornbury can be a difficult process. We recommend you secure guidance from a conveyancer and valuer well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Thornbury lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In the wake of eight months of unsuccessful negotiations with the landlord of her first floor flat in Thornbury, Alisha initiated the lease extension process as the eighty year deadline was quickly nearing. The lease extension was concluded in March 2010. The freeholder’s costs were negotiated to less than 450 pounds.
In 2011 we were called by Ms A González who, having completed a one bedroom flat in Thornbury in October 2008. We are asked if we could approximate the price would be to prolong the lease by ninety years. Similar properties in Thornbury with an extended lease were in the region of £257,800. The mid-range amount of ground rent was £65 collected quarterly. The lease ran out on 26 November 2090. Given that there were 65 years unexpired we calculated the premium to the landlord for the lease extension to be within £18,100 and £20,800 plus professional charges.
Dr Connor Morris owned a basement apartment in Thornbury in June 2008. We are asked if we could approximate the price could be to extend the lease by ninety years. Similar residencies in Thornbury with 100 year plus lease were valued about £191,400. The average ground rent payable was £55 billed yearly. The lease elapsed on 13 August 2079. Considering the 54 years remaining we calculated the compensation to the landlord for the lease extension to be within £34,200 and £39,600 plus expenses.