Billingham leases on domestic properties are gradually losing value. if your lease has approximately ninety years unexpired, you should start considering the need for a lease extension. 80 years is a significant number: when the unexpired term of a lease dips below this level then you begin incurring an additional element called marriage value. Leasehold owners in Billingham will usually qualify for a lease extension; however it’s a good idea to check with a lawyer to check your eligibility. In certain circumstances you may not be entitled. There are prescribed deadlines and steps to comply with once the process has started so it’s prudent to be guided by a lawyer during the process.
It is conventional wisdom that a property with more than 100 years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Irrespective of whether you are a tenant or a freeholder in Billingham,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Billingham valuers.
Aaron was the the leasehold owner of a studio flat in Billingham on the market with a lease of fraction over sixty years left. Aaron on an informal basis contacted his landlord a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to an increased rent to £200 yearly. Ordinarily, ground rent would not be payable on a lease extension were Aaron to exercise his statutory right. Aaron procured expert advice and was able to make an informed decision and handle with the matter and sell the flat.
In 2010 we were contacted by Dr P Girard who, having acquired a first floor flat in Billingham in July 2008. The question was if we could estimate the premium would likely be to extend the lease by a further 90 years. Identical homes in Billingham with 100 year plus lease were valued around £267,600. The mid-range amount of ground rent was £65 billed yearly. The lease ran out on 11 November 2092. Given that there were 67 years as a residual term we approximated the premium to the landlord for the lease extension to be within £14,300 and £16,400 exclusive of fees.
Last Winter we were approach by Mr and Mrs. N Michel , who completed a basement apartment in Billingham in February 2001. The dilemma was if we could estimate the compensation to the landlord would be to extend the lease by ninety years. Identical residencies in Billingham with a long lease were valued around £206,200. The average amount of ground rent was £55 collected yearly. The lease elapsed in 2081. Given that there were 56 years remaining we calculated the premium to the freeholder for the lease extension to be between £31,400 and £36,200 not including professional charges.