When it comes to long leasehold premises in Aylesbury, you are in fact renting it for a certain period of time. In recent years flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you may think about extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly especially when there are less than 80 years left. Leasehold owners in Aylesbury with a lease drawing near to 81 years unexpired should seriously consider extending it without delay. Once a lease has fewer than eighty years remaining, under the current Act the freeholder can calculate and charge a greater premium, assessed on a technical computation, strangely termed as “marriage value” which is due.
It is generally accepted that a property with over 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 35 years left, the premises will be equivalent in value to a freehold for many years in the future.
| 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. |
| 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with undertake Aylesbury 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.
Last October Benjamin, came precariously near to the eighty-year threshold with the lease on his first floor flat in Aylesbury. In buying his home twenty years ago, the unexpired term was of no importance. Luckily, it dawned on him that he needed to take steps soon on a lease extension. Benjamin extended the lease just under the wire last August. Benjamin and the landlord who owned the flat above ultimately agreed on an amount of £6,000 . If the lease had dropped lower than 80 years, the sum would have gone up by at least £1,075.
Mr and Mrs. O Morel purchased a basement flat in Aylesbury in April 2003. We are asked if we could estimate the compensation to the landlord would be to extend the lease by a further 90 years. Identical flats in Aylesbury with 100 year plus lease were in the region of £171,800. The average amount of ground rent was £55 collected quarterly. The lease expired on 10 May 2075. Taking into account 50 years unexpired we calculated the premium to the freeholder to extend the lease to be within £33,300 and £38,400 not including legals.
In 2011 we were e-mailed by Mrs Tia Green who, having owned a garden flat in Aylesbury in January 2007. The dilemma was if we could shed any light on how much (approximately) premium could be to prolong the lease by a further 90 years. Similar properties in Aylesbury with 100 year plus lease were worth £280,000. The average ground rent payable was £45 collected yearly. The lease terminated in 2095. Taking into account 70 years as a residual term we calculated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 exclusive of legals.