Owning a flat usually means owning a lease of the property, which has a finite term of years. This lease will usually be granted for a fixed period of time , ordinarily 99 or 125 years, although we have come across longer and shorter terms in Beaufort. Inevitably, the period of lease left reduces as time goes by. This may slip by relatively unnoticed when the property has to be disposed of or refinanced. The fewer the years remaining the lower the value of the property and the more expensive it will be to obtain a lease extension. Eligible long lease owners in Beaufort have the legal entitlement to extend the lease for an additional 90 years in accordance with legislation. You should give due consideration before delaying your Beaufort lease extension. Putting off that expense now simply increases the price you will ultimately have to pay to extend your lease
It is generally accepted that a residential leasehold with more than 100 years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for decades to come.
| 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; |
| 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service will provide you better control over the value of your Beaufort leasehold, as your property will be more valuable and saleable in respect of lease length should you want 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.
Muhammad owned a high value apartment in Beaufort being sold with a lease of a few days over 61 years outstanding. Muhammad informally approached his freeholder being a well known London-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 subject to a rise in the rent to £200 yearly. Ordinarily, ground rent would not be due on a lease extension were Muhammad to invoke his statutory right. Muhammad obtained expert legal guidance and secured an acceptable resolution informally and ending up with a market value flat.
In 2009 we were phoned by Mr Elijah Young who, having purchased a newly refurbished apartment in Beaufort in September 1997. We are asked if we could shed any light on how much (roughly) price could be to extend the lease by 90 years. Similar premises in Beaufort with an extended lease were valued about £210,000. The average ground rent payable was £50 collected per annum. The lease terminated on 24 August 2106. Considering the 80 years unexpired we calculated the premium to the landlord to extend the lease to be within £8,600 and £9,800 not including legals.
In 2013 we were e-mailed by Dr Sian Patel who, having bought a ground floor flat in Beaufort in August 1995. We are asked if we could shed any light on how much (approximately) price could be for a ninety year extension to my lease. Comparative homes in Beaufort with a long lease were in the region of £275,000. The average ground rent payable was £45 invoiced yearly. The lease ended on 24 February 2095. Considering the 69 years left we approximated the premium to the freeholder for the lease extension to be between £12,400 and £14,200 not including costs.