Badminton leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease gets more expensive. It is the case that most Badminton tenants have the right to extend their lease by an additional 90 years in accordance with the 1993 Leasehold Reform Act. Where you are a leasehold owner in Badminton you would be well advised to check if your lease has between seventy and ninety years remaining. There are compelling reasons why a Badminton flat owner with a lease having around eighty years left should take action to make sure that a lease extension is put in place without delay
Leasehold premises in Badminton with more than 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Badminton,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Badminton valuers.
Two years ago Dexter, came critically close to the 80-year threshold with the lease on his basement apartment in Badminton. Having bought his property two decades ago, the lease term was of minimal significance. Fortunately, he noticed he needed to take steps soon on a lease extension. Dexter arranged for a lease extension at the eleventh hour last August. Dexter and the landlord who owned the flat above in the end agreed on a premium of £5,000 . If the lease had dropped to less than 80 years, the sum would have gone up by a minimum £1,150.
Mr Lewis Díaz moved into a garden apartment in Badminton in October 2006. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be for a ninety year extension to my lease. Comparative homes in Badminton with an extended lease were in the region of £206,200. The average amount of ground rent was £60 invoiced per annum. The lease lapsed on 11 July 2082. Having 56 years as a residual term we calculated the compensation to the landlord to extend the lease to be within £32,300 and £37,400 exclusive of expenses.
In 2009 we were called by Dr J Dupont who, having purchased a garden apartment in Badminton in October 2010. We are asked if we could estimate the premium would likely be to extend the lease by ninety years. Similar residencies in Badminton with an extended lease were in the region of £300,000. The mid-range ground rent payable was £50 billed monthly. The lease came to a finish in 2102. Given that there were 76 years left we estimated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 exclusive of costs.