It’s an underpublicised certainty that a Alresford residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Alresford property prices.Where your lease has approximately 90 years left, 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 half of the property's 'marriage value' on top of 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 Most flat owners in Alresford will be able to extend under the legislation; however a conveyancer will be able to confirm whether you are eligibility. In some cases you may not qualify. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your lawyer throughout the formalities.
Leasehold properties in Alresford with in excess of one hundred years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value 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 maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| 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. |
| 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 |
The lawyers that we work with undertake Alresford 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 conveyancer we work with provide it.
Elijah owned a studio apartment in Alresford on the market with a lease of a little over 61 years remaining. Elijah on an informal basis spoke with his landlord 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 £150 per annum and doubled every twenty five years thereafter. No ground rent would be payable on a lease extension were Elijah to exercise his statutory right. Elijah procured expert legal guidance and secured satisfactory deal without resorting to tribunal and ending up with a market value flat.
Mrs M Wood took over the lease of a ground floor flat in Alresford in August 2012. We are asked if we could approximate the premium would be to prolong the lease by a further 90 years. Identical properties in Alresford with a long lease were valued around £225,800. The mid-range amount of ground rent was £60 collected annually. The lease finished on 20 October 2085. Considering the 60 years remaining we calculated the premium to the landlord to extend the lease to be within £23,800 and £27,400 exclusive of legals.
Last Autumn we were e-mailed by Mr Ben Leroy , who moved into a garden flat in Alresford in February 2001. The dilemma was if we could estimate the price would likely be to extend the lease by ninety years. Comparative premises in Alresford with a long lease were valued around £210,000. The average amount of ground rent was £50 invoiced per annum. The lease ended on 8 October 2105. Considering the 80 years left we calculated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 not including professional charges.