Unfortunately that a Arnside residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Arnside property prices.Where your lease has approximately 90 years left, you should start considering 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 below 80 years - otherwise a higher amount will be payable. Most leasehold owners in Arnside will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify if you qualify for an extension. In some situations you may not qualify. There are also strict deadlines and procedures to be adhered to once the process is instigated and you will need to be guided by your lawyer from beginning to end of the process.
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 additional ninety years added to any lease with more than 35 years left, the residence will be equivalent in value to a freehold for many years in the future.
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
Using our service will provide you better control over the value of your Arnside leasehold, as your property will be more valuable and saleable in relation to the lease length should you want to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Jayden owned a studio flat in Arnside being marketed with a lease of a little over 72 years remaining. Jayden informally spoke with his freeholder a well known local-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of an increased rent to £100 yearly. Ordinarily, ground rent would not be payable on a lease extension were Jayden to exercise his statutory right. Jayden procured expert legal guidance and secured an acceptable resolution informally and readily saleable.
In 2011 we were approached by Dr Alexander Roberts who, having completed a studio flat in Arnside in June 1996. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be to prolong the lease by 90 years. Comparative premises in Arnside with 100 year plus lease were in the region of £210,000. The mid-range amount of ground rent was £50 invoiced yearly. The lease lapsed in 2105. Having 80 years as a residual term we calculated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 exclusive of fees.
Last Winter we were e-mailed by Mr and Mrs. A Sánchez , who acquired a basement apartment in Arnside in August 2002. The dilemma was if we could approximate the compensation to the landlord would likely be for a 90 year extension to my lease. Similar flats in Arnside with an extended lease were valued around £275,000. The average amount of ground rent was £45 invoiced monthly. The lease finished on 12 October 2094. Considering the 69 years remaining we estimated the compensation to the freeholder to extend the lease to be within £12,400 and £14,200 exclusive of professional charges.