Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will normally be granted for a fixed period of time , usually 99 or 125 years, although we have witnessed longer and shorter terms in Bitterne. Inevitably, the length of lease remaining shortens over time. This is often overlooked and only becomes a problem when the residence needs to be sold or re-mortgaged. The shorter the lease the lower the value of the property and the more it will cost to procure a lease extension. Eligible leaseholders in Bitterne have the legal entitlement to extend the lease for an additional 90 years in accordance with the 1993 Leasehold Reform Act. Please give due attention before putting off your Bitterne lease extension. Holding off that expense now only increases the price you will eventually have to pay for a lease extension
Leasehold premises in Bitterne with more than 100 years left 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 premises. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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. |
| 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. |
Irrespective of whether you are a tenant or a landlord in Bitterne,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 experience and the close ties they enjoy with Bitterne valuers.
In the wake of eight months of protracted discussions with the landlord of her first floor flat in Bitterne, Jessica commenced the lease extension process just as the lease was approaching the crucial 80-year threshold. The legal work was concluded in October 2010. The landlord’s costs were kept to an absolute minimum.
Mrs Bethan Bell purchased a garden flat in Bitterne in March 1995. We are asked if we could estimate the premium would likely be for a ninety year extension to my lease. Comparable homes in Bitterne with 100 year plus lease were valued around £270,000. The mid-range ground rent payable was £55 collected yearly. The lease ran out on 1 March 2100. Considering the 74 years remaining we calculated the premium to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of costs.
Last Winter we were e-mailed by Mr Gabriel Mitchell , who acquired a newly refurbished flat in Bitterne in March 2006. We are asked if we could approximate the premium would likely be to extend the lease by 90 years. Comparative homes in Bitterne with an extended lease were worth £166,400. The mid-range ground rent payable was £60 billed monthly. The lease concluded on 2 January 2080. Considering the 54 years unexpired we estimated the premium to the landlord for the lease extension to be between £32,300 and £37,400 not including fees.