Amesbury leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Legislation has been in place for sometime now which entitles qualifying Amesbury residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Amesbury you really ought to investigate if your lease has between 70 and 90 years remaining. In particular once the remaining lease term slips under eighty years, the amount payable for any lease extension sharply increases as part of the premium you pay is what is known as a marriage value
Leasehold properties in Amesbury with in excess of one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little to be gained by buying 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 are not acceptable. 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; |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| Yorkshire 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. |
Retaining our service will provide you increased control over the value of your Amesbury leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Twenty four months ago Noah, came seriously close to the 80-year threshold with the lease on his basement flat in Amesbury. Having purchased his property two decades ago, the lease term was of minimal relevance. Fortunately, he became aware that he would imminently be paying an inflated amount for a lease extension. Noah extended the lease just ahead of time last May. Noah and the landlord in the end agreed on sum of £6,000 . If the lease had slipped to less than eighty years, the sum would have increased by at least £1,050.
Last Summer we were phoned by Mr and Mrs. U Thomas , who bought a one bedroom flat in Amesbury in September 1998. The question was if we could shed any light on how much (approximately) premium would likely be to prolong the lease by 90 years. Comparative homes in Amesbury with an extended lease were in the region of £201,200. The mid-range amount of ground rent was £55 billed every twelve months. The lease ended on 2 November 2082. Considering the 56 years left we estimated the compensation to the landlord to extend the lease to be within £31,400 and £36,200 plus professional charges.
In 2012 we were phoned by Mr and Mrs. A Bernard who, having bought a one bedroom flat in Amesbury in January 2011. We are asked if we could estimate the premium could be to extend the lease by an additional years. Identical properties in Amesbury with a long lease were in the region of £300,000. The average amount of ground rent was £50 invoiced every twelve months. The lease ended on 9 March 2102. Considering the 76 years left we calculated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 plus legals.