Unfortunately that a Amble residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the deflation being disguised by increases in the Amble property prices.Where your lease has approximately 90 years left, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips lower than 80 years - otherwise a higher amount will be payable. Most leasehold owners in Amble will be able to extend under the legislation; however a lawyer will be able to confirm whether you are eligibility. In some cases you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancer from beginning to end of the process.
It is generally accepted that a property with more than one hundred years remaining is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for many years ahead.
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Chelsea Building Society | 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. |
| Godiva Mortgages | 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service gives you increased control over the value of your Amble leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last year Harvey, started to get near to the eighty-year mark with the lease on his first floor apartment in Amble. In buying his property twenty years ago, the lease term was of little bearing. As luck would have it, he realised he would imminently be paying an inflated amount for Extending the lease. Harvey arranged for a lease extension at the eleventh hour last July. Harvey and the freeholder via the management company eventually settled on sum of £5,500 . If he failed to meet the deadline, the price would have become more costly by a minimum £925.
Dr N Mitchell bought a first floor apartment in Amble in November 2001. The dilemma was if we could estimate the premium could be for a 90 year extension to my lease. Comparative premises in Amble with an extended lease were worth £198,800. The average amount of ground rent was £55 invoiced quarterly. The lease terminated on 12 July 2080. Considering the 55 years unexpired we estimated the compensation to the landlord for the lease extension to be within £33,300 and £38,400 exclusive of expenses.
Last Summer we were called by Mr and Mrs. J Bailey , who owned a ground floor apartment in Amble in August 2007. We are asked if we could shed any light on how much (approximately) price would likely be for a ninety year extension to my lease. Comparable flats in Amble with 100 year plus lease were in the region of £295,000. The average amount of ground rent was £50 invoiced annually. The lease termination date was in 2100. Taking into account 75 years outstanding we calculated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 not including professional charges.