Belper leases on residential properties are gradually decreasing in 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 Belper tenants have the right to extend their lease by an additional 90 years in accordance with the 1993 Leasehold Reform Act. If you are a leasehold owner in Belper you must check if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under eighty years, the cost of any lease extension sharply increases as part of the premium you will incur is what is known as a marriage value
Leasehold premises in Belper with in excess of 100 years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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 |
The lawyers that we work with procure Belper 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.
After protracted negotiations with the landlord of her basement apartment in Belper, Caitlin started the lease extension process as the eighty year deadline was fast advancing. The lease extension completed in July 2007. The landlord’s costs were restricted to a tad over 550 GBP.
Mrs Jessica Wright moved into a first floor flat in Belper in January 1996. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord could be to extend the lease by a further 90 years. Comparable properties in Belper with an extended lease were in the region of £220,400. The average amount of ground rent was £45 billed every twelve months. The lease ended on 21 January 2090. Considering the 64 years left we calculated the compensation to the freeholder for the lease extension to be within £16,200 and £18,600 exclusive of expenses.
Last month we were e-mailed by Dr K Morris , who moved into a recently refurbished flat in Belper in August 2006. We are asked if we could shed any light on how much (roughly) price would be for a ninety year lease extension. Identical residencies in Belper with a long lease were valued around £270,000. The average ground rent payable was £55 invoiced monthly. The lease came to a finish on 18 June 2101. Having 75 years outstanding we estimated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of costs.