Unfortunately that a Billericay residential lease is a wasting 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 depreciation being disguised by increases in the Billericay property market.Where your lease has approximately ninety years left, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips under eighty years - otherwise a higher premium will be payable. The majority of leasehold owners in Billericay will be able to extend under the legislation; however a lawyer should be able to confirm whether you are eligibility. In some cases you may not qualify. There are also strict timetables and procedures to follow once the process is instigated and you will need to be guided by your conveyancing solicitor for the duration of the process.
Leasehold residencies in Billericay with more than one hundred years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a landlord in Billericay,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Billericay valuers.
Elijah was the the leasehold proprietor of a 2 bedroom apartment in Billericay being marketed with a lease of a few days over fifty eight years left. Elijah informally contacted his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £100 per annum. No ground rent would be due on a lease extension were Elijah to invoke his statutory right. Elijah procured expert advice and secured an acceptable resolution without resorting to tribunal and ending up with a market value flat.
In 2010 we were approached by Dr G Dupont who, having completed a one bedroom flat in Billericay in August 2011. The question was if we could estimate the compensation to the landlord would be for a 90 year lease extension. Similar properties in Billericay with 100 year plus lease were valued around £275,000. The mid-range ground rent payable was £55 billed every twelve months. The lease terminated on 14 June 2102. Having 76 years as a residual term we calculated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of costs.
Mr I Flores purchased a basement flat in Billericay in May 2002. We are asked if we could shed any light on how much (roughly) premium would be for a 90 year lease extension. Identical residencies in Billericay with 100 year plus lease were in the region of £176,200. The average ground rent payable was £65 billed yearly. The lease concluded in 2082. Having 56 years remaining we estimated the premium to the freeholder to extend the lease to be between £29,500 and £34,000 plus expenses.