With a long leasehold premises in Bingley, you are in fact renting it for a certain period of time. In recent years flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you should consider a lease extension sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly notably when there are fewer than eighty years left. Leasehold owners in Bingley with a lease drawing near to 81 years unexpired should seriously think of extending it sooner as opposed to later. When the lease term has below eighty years outstanding, under the current Act the freeholder is entitled to calculate and levy a greater premium, based on a technical calculation, strangely termed as “marriage value” which is due.
It is conventional wisdom that a residential leasehold with more than one hundred years remaining is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 30 years left, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date 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 |
| 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 enhanced control over the value of your Bingley leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In the wake of 6 months of lengthy negotiations with the freeholder of her first floor flat in Bingley, Emma initiated the lease extension process just as her lease was approaching the all-important eighty-year deadline. The transaction was concluded in March 2011. The landlord’s charges were negotiated to approximately 500 pounds.
Last Spring we were approach by Mr and Mrs. G Harris , who owned a one bedroom apartment in Bingley in February 1998. The dilemma was if we could approximate the compensation to the landlord would be for a 90 year lease extension. Comparable flats in Bingley with an extended lease were valued about £203,200. The average ground rent payable was £65 invoiced monthly. The lease end date was on 7 September 2086. Considering the 61 years outstanding we estimated the compensation to the landlord to extend the lease to be within £19,000 and £22,000 plus legals.
In 2009 we were called by Dr Ollie Ramírez who, having moved into a studio apartment in Bingley in November 1997. The question was if we could estimate the premium could be to extend the lease by ninety years. Identical flats in Bingley with 100 year plus lease were in the region of £260,000. The average ground rent payable was £50 invoiced annually. The lease lapsed in 2097. Given that there were 72 years left we estimated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 plus fees.