Banwell leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. It is the case that most Banwell tenants have the right to extend their lease by an additional ninety years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in Banwell you must check if your lease has between 70 and 90 years remaining. There are good reasons why a Banwell flat owner with a lease having around eighty years remaining should take steps to ensure that a lease extension is actioned without delay
It is generally accepted that a residential leasehold with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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 lawyers that we work with procure Banwell 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.
Michael owned a studio apartment in Banwell being marketed with a lease of a few days over fifty eight years outstanding. Michael informally approached his freeholder a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent to start with set at £100 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Michael to invoke his statutory right. Michael procured expert legal guidance and secured satisfactory deal informally and readily saleable.
In 2013 we were approached by Dr Muhammad Johnson who, having purchased a purpose-built apartment in Banwell in May 2012. The dilemma was if we could approximate the price would be for a 90 year lease extension. Comparable properties in Banwell with a long lease were in the region of £176,200. The average amount of ground rent was £65 invoiced every twelve months. The lease came to a finish in 2081. Taking into account 56 years remaining we estimated the compensation to the landlord for the lease extension to be between £29,500 and £34,000 exclusive of expenses.
Last Christmas we were phoned by Mrs N Norbert , who was assigned a lease of a garden apartment in Banwell in August 2000. The dilemma was if we could estimate the premium would be for a 90 year lease extension. Comparable homes in Banwell with 100 year plus lease were valued about £242,600. The mid-range ground rent payable was £45 invoiced yearly. The lease finished on 6 January 2092. Having 67 years outstanding we estimated the compensation to the freeholder to extend the lease to be between £11,400 and £13,200 exclusive of professional charges.