Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will ordinarily be granted for a prescribed period of time , usually 99 or 125 years, although we have witnessed longer and shorter terms in Blakelaw. Clearly, the period of lease left shortens over time. This may pass by relatively unnoticed when the flat or house has to be disposed of or refinanced. The shorter the lease the lower the value of the property and the more it will cost to obtain a lease extension. Eligible leaseholders in Blakelaw have the legal entitlement to extend the lease for a further ninety years in accordance with legislation. Please give careful deliberation before putting off your Blakelaw lease extension. Putting off that expense now only increases the price you will ultimately incur for a lease extension
Leasehold residencies in Blakelaw with over 100 years left 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 property. In such situations there is often little upside in buying the freehold unless savings on ground rent and maintenance 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. |
| Godiva Mortgages | 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. |
| Halifax | 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. |
Retaining our service will provide you better control over the value of your Blakelaw leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Hugo owned a high value flat in Blakelaw being marketed with a lease of fraction over 61 years outstanding. Hugo informally spoke with his freeholder being a well known local-based freehold company for a lease extension. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and increase every twenty five years thereafter. No ground rent would be payable on a lease extension were Hugo to invoke his statutory right. Hugo procured expert advice and secured an acceptable resolution without resorting to tribunal and sell the flat.
In 2011 we were called by Mr G David who, having owned a first floor apartment in Blakelaw in April 1997. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be to extend the lease by an additional years. Comparable premises in Blakelaw with an extended lease were worth £255,000. The average amount of ground rent was £50 billed monthly. The lease elapsed on 28 March 2097. Considering the 71 years left we approximated the compensation to the freeholder for the lease extension to be within £9,500 and £11,000 plus legals.
In 2013 we were e-mailed by Mr and Mrs. W Gray who, having purchased a studio apartment in Blakelaw in August 1997. The question was if we could approximate the premium would likely be to extend the lease by an additional years. Comparable homes in Blakelaw with 100 year plus lease were worth £254,200. The mid-range ground rent payable was £60 invoiced quarterly. The lease elapsed in 2077. Having 51 years remaining we estimated the premium to the freeholder for the lease extension to be within £43,700 and £50,600 plus costs.