When it comes to domestic leasehold property in Thornbury, you are in fact renting it for a certain period of time. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you should consider extending the lease sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly particularly when there are less than 80 years remaining. Residents in Thornbury with a lease approaching 81 years left should seriously consider extending it without delay. Once the lease term has below eighty years outstanding, under the relevant Act the freeholder is entitled to calculate and demand a greater premium, assessed on a technical multiplication, known as “marriage value” which is due.
Leasehold premises in Thornbury 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 premises. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges justify it.
| 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. |
| 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. |
| 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a freeholder in Thornbury,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Thornbury valuers.
During the course of the last few months Thomas, started to get near to the 80-year threshold with the lease on his basement apartment in Thornbury. Having purchased his home two decades ago, the lease term was of minimal significance. As luck would have it, it dawned on him that he needed to take steps soon on a lease extension. Thomas was able to extend his lease just under the wire last April. Thomas and the freeholder subsequently agreed on the final figure of £6,000 . If the lease had gone below eighty years, the amount would have gone up by at least £1,150.
Last month we were e-mailed by Mr S Ricardo , who moved into a basement apartment in Thornbury in October 2007. We are asked if we could shed any light on how much (roughly) premium could be for a 90 year extension to my lease. Comparable flats in Thornbury with 100 year plus lease were worth £280,000. The mid-range ground rent payable was £45 collected quarterly. The lease lapsed in 2096. Considering the 70 years remaining we approximated the compensation to the freeholder to extend the lease to be within £12,400 and £14,200 exclusive of fees.
Mr and Mrs. I Robinson purchased a newly refurbished flat in Thornbury in March 2002. We are asked if we could approximate the premium could be to extend the lease by a further 90 years. Identical flats in Thornbury with an extended lease were in the region of £223,400. The mid-range ground rent payable was £60 collected per annum. The lease ran out in 2085. Taking into account 59 years as a residual term we estimated the compensation to the freeholder to extend the lease to be within £27,600 and £31,800 plus expenses.