The re-sale value of a leasehold property in Birch and Middleton depends on how many years the lease has left to run. If it is close to or fewer than eighty years you should anticipate difficulties on re-sale, so it is advisable to arrange for a lease extension ahead of purchasing. It is preferable to commence the process of extending the lease is when the lease still has 82 years remaining so that formalities can be concluded prior to the eighty year cut off point. Statute enables Birch and Middleton qualifying lessees to acquire a lease extension of 90 years on top of the remaining length of the lease at a peppercorn rent (that is, rent free). The reason of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold premises in Birch and Middleton with over one hundred years remaining on the lease are sometimes 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 purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
| 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 |
| Yorkshire 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. |
The conveyancers that we work with handle Birch and Middleton 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.
Off the back of unsuccessful correspondence with the freeholder of her first floor apartment in Birch and Middleton, Kayleigh initiated the lease extension process just as the lease was approaching the all-important eighty-year deadline. The transaction was concluded in April 2015. The freeholder’s costs were kept to an absolute minimum.
Mr and Mrs. V Stewart bought a first floor apartment in Birch and Middleton in February 1997. The question was if we could approximate the premium would be for a ninety year lease extension. Comparable premises in Birch and Middleton with 100 year plus lease were valued about £198,800. The average amount of ground rent was £55 collected every twelve months. The lease ran out in 2081. Considering the 55 years left we estimated the premium to the landlord for the lease extension to be between £33,300 and £38,400 plus legals.
In 2010 we were phoned by Dr G Pérez who, having was assigned a lease of a basement apartment in Birch and Middleton in May 1999. The dilemma was if we could shed any light on how much (approximately) premium could be to prolong the lease by a further 90 years. Comparable properties in Birch and Middleton with an extended lease were worth £295,000. The mid-range ground rent payable was £50 collected per annum. The lease came to a finish on 5 November 2101. Having 75 years left we estimated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 not including fees.