Bamburgh leases on domestic properties are gradually losing value. Where your lease has about 90 years unexpired, you should start thinking about a lease extension. It is important to recognise that it is that it is financially advisable for a lease extension to be in place before the term of the current lease falls below eighty years - otherwise a higher premium will be due. Leasehold owners in Bamburgh will usually qualify for a lease extension; however it’s a good idea to check with a conveyancer to check your eligibility. In certain cases you may not qualify. There are prescribed timetables and steps to follow once the process has started so it’s best to be guided by a lawyer during the process.
It is conventional wisdom that a residential leasehold with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the property 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 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; |
| Coventry Building Society | 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a freeholder in Bamburgh,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Bamburgh valuers.
Arthur was the the leasehold owner of a conversion apartment in Bamburgh on the market with a lease of a few days over 72 years remaining. Arthur on an informal basis contacted his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £100 yearly. No ground rent would be due on a lease extension were Arthur to exercise his statutory right. Arthur procured expert legal guidance and was able to make a more informed judgement and deal with the matter and sell the flat.
Last Christmas we were contacted by Mr and Mrs. M García , who took over the lease of a garden apartment in Bamburgh in January 2005. We are asked if we could estimate the premium could be to prolong the lease by ninety years. Identical premises in Bamburgh with 100 year plus lease were in the region of £275,000. The average amount of ground rent was £55 billed monthly. The lease termination date was in 2103. Taking into account 77 years as a residual term we estimated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of professional charges.
In 2011 we were contacted by Ms Lily Fournier who, having bought a ground floor flat in Bamburgh in June 1997. We are asked if we could shed any light on how much (roughly) premium could be to extend the lease by ninety years. Comparative premises in Bamburgh with 100 year plus lease were in the region of £183,600. The mid-range ground rent payable was £65 invoiced every twelve months. The lease expired in 2083. Having 57 years remaining we calculated the premium to the freeholder to extend the lease to be between £28,500 and £33,000 exclusive of professional charges.