There is no doubt about it a leasehold property in Beacon Hill is a wasting asset as a result of the diminishing lease term. Where the residual term has, in excess of 125 years remaining then this decrease may be of little impact nevertheless there will become a stage when a lease has under than 80 years left as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main rational as to why you should consider extending without delay. The majority of flat owners in Beacon Hill will qualify for this right; however a conveyancing solicitor can advise if you are eligible to extend your lease. In certain situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
It is generally accepted that a property with over 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service gives you better control over the value of your Beacon Hill leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last October Arthur, started to get near to the 80-year mark with the lease on his ground floor apartment in Beacon Hill. In buying his home 18 years ago, the length of the lease was of no relevance. Luckily, he realised he would soon be paying an inflated amount for a lease extension. Arthur extended the lease just under the wire in May. Arthur and the freeholder subsequently settled on an amount of £5,500 . If he failed to meet the deadline, the price would have become more exhorbitant by a minimum £875.
Dr U Thomas moved into a basement apartment in Beacon Hill in November 2000. The dilemma was if we could approximate the premium would likely be for a ninety year lease extension. Similar residencies in Beacon Hill with 100 year plus lease were in the region of £189,000. The average amount of ground rent was £55 collected per annum. The lease lapsed on 22 July 2078. Having 53 years remaining we calculated the compensation to the freeholder to extend the lease to be between £28,500 and £33,000 not including fees.
In 2012 we were called by Mr and Mrs. Y Sánchez who, having acquired a first floor flat in Beacon Hill in February 2010. The dilemma was if we could shed any light on how much (approximately) price would be to extend the lease by an additional years. Similar premises in Beacon Hill with an extended lease were in the region of £290,000. The mid-range amount of ground rent was £45 billed monthly. The lease end date was on 18 January 2098. Given that there were 73 years left we approximated the premium to the landlord to extend the lease to be between £9,500 and £11,000 plus fees.