Billericay leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Billericay residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Billericay you would be well advised to check if your lease has between seventy and 90 years left. In particular once the remaining lease term slips under 80 years, the compensation to the landlord for any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
Leasehold residencies in Billericay with over one hundred years unexpired 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 property. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and service charges warrant it.
| 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; |
| 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a freeholder in Billericay,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 in-depth market knowledge and the close ties they enjoy with Billericay valuers.
In 2014 Jack, came dangerously near to the eighty-year threshold with the lease on his two bedroom apartment in Billericay. Having purchased his home two decades ago, the length of the lease was of little importance. As luck would have it, it dawned on him that he needed to take action soon on Extending the lease. Jack was able to extend his lease at the eleventh hour last June. Jack and the freeholder via the management company ultimately agreed on a premium of £5,500 . If the lease had slipped below 80 years, the price would have gone up by a minimum £975.
Mr T Dupont took over the lease of a garden flat in Billericay in February 2008. The dilemma was if we could approximate the premium could be for a ninety year lease extension. Similar flats in Billericay with 100 year plus lease were in the region of £254,200. The mid-range amount of ground rent was £60 collected yearly. The lease ran out on 17 July 2077. Taking into account 51 years remaining we approximated the premium to the freeholder to extend the lease to be between £43,700 and £50,600 exclusive of costs.
Dr E Baker bought a basement flat in Billericay in March 2000. We are asked if we could approximate the premium would be to extend the lease by ninety years. Comparable homes in Billericay with an extended lease were in the region of £210,600. The average ground rent payable was £45 invoiced quarterly. The lease expiry date was on 28 August 2088. Taking into account 62 years as a residual term we estimated the compensation to the freeholder to extend the lease to be between £18,100 and £20,800 not including costs.