Unfortunately that a Totterdown residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. 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 Totterdown property prices.Once your lease nears 85ish years, you need to start considering a lease extension. If the number of years remaining slips below eighty years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property The majority of flat owners in Totterdown will be able to extend under the legislation; however a lawyer should be able to confirm whether you are eligibility. In some situations you may not qualify. There are also strict timeframes and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
It is generally considered that a residential leasehold with over one hundred years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 30 years remaining, the residence will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with undertake Totterdown lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancing solicitor we work with provide it.
After unsuccessful negotiations with the landlord of her purpose-built apartment in Totterdown, Millie started the lease extension process just as her lease was coming close to the all-important eighty-year mark. The transaction was finalised in September 2011. The freeholder’s fees were kept to an absolute minimum.
Mr and Mrs. H Adams owned a ground floor apartment in Totterdown in March 2011. The question was if we could shed any light on how much (roughly) price could be for a 90 year extension to my lease. Comparative flats in Totterdown with 100 year plus lease were in the region of £285,000. The average ground rent payable was £55 invoiced per annum. The lease lapsed on 8 May 2104. Given that there were 79 years remaining we approximated the premium to the landlord for the lease extension to be within £13,300 and £15,400 plus professional charges.
Mr and Mrs. J Moore took over the lease of a basement apartment in Totterdown in February 2010. We are asked if we could approximate the compensation to the landlord would likely be to prolong the lease by an additional years. Comparable flats in Totterdown with a long lease were worth £193,400. The mid-range ground rent payable was £65 collected monthly. The lease terminated on 22 July 2084. Considering the 59 years outstanding we estimated the compensation to the landlord for the lease extension to be between £21,900 and £25,200 not including expenses.