It’s a harsh truth that a Barnoldswick residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the reduction being disguised by increases in the Barnoldswick property prices.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. If lease term slips below eighty years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property Most flat owners in Barnoldswick will be able to extend under the legislation; however a lawyer should be able to clarify if you are eligibility. In some situations you may not qualify. There are also strict timeframes and procedures to follow once the process has commenced and you will need to be guided by your conveyancer for the duration of the process.
Leasehold properties in Barnoldswick with in excess of 100 years left on the lease are sometimes 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 merit it.
| Lender | Requirement |
|---|---|
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Irrespective of whether you are a tenant or a landlord in Barnoldswick,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Barnoldswick valuers.
In 2014 Jack, came dangerously close to the eighty-year mark with the lease on his first floor flat in Barnoldswick. In buying his home 18 years ago, the unexpired term was of little significance. by good luck, he noticed he needed to take steps soon on a lease extension. Jack extended the lease at the eleventh hour in August. Jack and the landlord eventually settled on an amount of £5,500 . If the lease had slipped to less than 80 years, the premium would have become more costly by a minimum £1,075.
Ms Grace Morris bought a first floor flat in Barnoldswick in February 2011. The dilemma was if we could estimate the compensation to the landlord would likely be to extend the lease by ninety years. Comparable residencies in Barnoldswick with 100 year plus lease were worth £252,800. The mid-range amount of ground rent was £65 collected yearly. The lease lapsed in 2091. Given that there were 65 years unexpired we approximated the premium to the landlord to extend the lease to be between £18,100 and £20,800 plus professional charges.
Mr and Mrs. G Vincent was assigned a lease of a purpose-built apartment in Barnoldswick in March 1996. We are asked if we could shed any light on how much (roughly) premium would be for a ninety year lease extension. Comparative premises in Barnoldswick with 100 year plus lease were worth £191,400. The average amount of ground rent was £55 collected quarterly. The lease lapsed in 2080. Considering the 54 years left we estimated the compensation to the freeholder for the lease extension to be between £34,200 and £39,600 exclusive of costs.