With a long leasehold premises in Audley, you are actually buying an entitlement to reside in a property for a prescribed time frame. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you may think about a lease extension sooner rather than later. The general rule is that the shorter the number of years is the cost of extending the lease becomes disproportionately greater notably when there are fewer than eighty years left. Leasehold owners in Audley with a lease approaching 81 years left should seriously think of extending it sooner than later. When the lease term has fewer than 80 years left, under the relevant Act the freeholder is entitled to calculate and levy a greater premium, assessed on a technical calculation, strangely termed as “marriage value” which is due.
Leasehold residencies in Audley with in excess of one hundred years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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 |
| 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. |
The conveyancing solicitors that we work with handle Audley 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.
Adam owned a 2 bedroom apartment in Audley being sold with a lease of fraction over sixty years remaining. Adam informally spoke with his freeholder being a well known London-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to an increased rent to £50 annually. Ordinarily, ground rent would not be payable on a lease extension were Adam to exercise his statutory right. Adam procured expert legal guidance and was able to make an informed decision and handle with the matter and readily saleable.
In 2011 we were called by Mr and Mrs. P Rivera who, having owned a studio flat in Audley in July 2003. The question was if we could shed any light on how much (roughly) compensation to the landlord would likely be to prolong the lease by ninety years. Identical residencies in Audley with a long lease were in the region of £280,000. The average amount of ground rent was £55 billed yearly. The lease ended in 2103. Given that there were 78 years unexpired we estimated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 exclusive of legals.
In 2010 we were phoned by Mr and Mrs. Y Gómez who, having purchased a studio flat in Audley in October 2008. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be to extend the lease by 90 years. Identical premises in Audley with a long lease were in the region of £186,000. The mid-range ground rent payable was £65 billed quarterly. The lease lapsed in 2083. Given that there were 58 years as a residual term we calculated the compensation to the landlord to extend the lease to be within £24,700 and £28,600 plus professional charges.