Blakeney Lease Extension - Free Consultation

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Main reasons to commence your Blakeney lease extension


Main reasons to commence your Blakeney lease extension today:

A Blakeney leasehold property depreciates with the years remaining on the lease.

The nearer a residential lease in Blakeney nears to zero years unexpired, the more it reduces the value of the property. If the residual term has, in excess of 125 years remaining then this decrease may be negligible nevertheless there will become a stage when a lease has under than eighty years unexpired as part of the premium you will incur is what is termed as a marriage value. This could increase sharply the cost. It is the main reason why you should extend the lease without delay. Many flat owners in Blakeney will qualify for this right; however a lawyer should be able to advise if you qualify for a lease extension. In certain situations you may not qualify, the most common reason being that you have owned the property for less than two years.

Blakeney property with a lease extension has roughly the same value as a freehold

Leasehold properties in Blakeney 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 home. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges warrant it.

Banks and Building Societies may decide not to grant a mortgage with a short lease

Banks and Building Societies have specific criteria when loaning monies charged on leasehold property. Many will simply refrain from lending at all once an unexpired lease term goes lower than a certain unexpired lease term. Many Lending institutions will not regard property with a remaining term of less than 75 years suitable security. As well as impacting your ability to sell, it is also relevant if you are wanting to remortgage your Blakeney property.

Lender Requirement
Barnsley Building Society 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term.
Leeds Building Society 85 years remaing from the start of the mortgage.
Nationwide Building Society - Our minimum unexpired lease term is 55 years.
- There must be at least 30 years remaining at the end of the mortgage term (regardless of the length of lease at the start).

Where the unexpired lease term is different to that recorded on the mortgage offer, the following clarifies if we need to be informed:

Second hand property:
- If the unexpired lease term on the offer is 85 years or more - only advise us if the actual lease term is less than 85 years
- if the unexpired lease term on the offer is less than 85 years – advise us if the actual lease term is different than reported
- For equity share applications - advise us if the actual lease term is different than reported on the offer

New build property:
- If the unexpired lease term stated on the offer is 125 years (flat) / 250 years (house) or more - only advise us if the actual lease term is less than 125 years (flat) / 250 years (house)
- For equity share applications - always advise us if the actual lease term is different than reported on the offer

Lease terms such as ground rent and event fees must be reasonable at all times during the term of the lease and adhere to our requirements below. If you’re unsure as to whether the terms of a lease are unreasonable or onerous, please refer the details to us in plain English for Valuer consideration. If the potentially onerous terms are in relation to the ground rent please include the current ground rent figure per annum, how often it will be reviewed and the price structure it will be reviewed against. See the guidance below.

SECOND HAND PROPERTIES

Unacceptable - advise Issuing Office (Will be declined):
- Unexpired lease term less than 55 years
- Less than 30 years remaining at the end of the mortgage term
- Ground Rent greater than 0.5% of the property value
- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more
- Ground Rent is compounded RPI
- Ground Rent review period is less than or equal to 5 years

Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Unexpired lease term is 55 to 85 years
- Ground Rent greater than 0.1% and less than or equal to 0.5% of the property value
- Ground Rent escalation is linked to any indices greater than RPI
- Ground Rent escalation is linked to the value of the building*
- Ground Rent review period is greater than 5 and less than 10 years
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial, etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 0.5% of property value p/a (please provide details of what the charges cover)
- Anything that appears onerous, unusual or out of the ordinary

Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than 85 years
- Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than or equal to 10 years
- Ground Rent escalation less than or equal to RPI

NEW BUILD PROPERTIES (includes office conversions)

Unacceptable - advise Issuing Office (Will be declined)
- Unexpired lease term less than 125 years on a new build flat or less than 250 years on a new build house (does not apply to Shared Ownership)
- Starting Ground Rent greater than 0.1% of the property value
- Ground Rent review period less than or equal to every 5 years
- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more
- Ground Rent is compounded RPI

Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Ground Rent is linked to any indices greater than RPI
- Ground Rent is linked to the value of the building*
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 0.5% of property value p/a (please provide details of what the charges cover)
- Anything else appears onerous, unusual or out of the ordinary

Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than or equal to 125 years on a new build flat or greater than or equal to 250 years on a new build house
- Starting Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than 5 years
- Ground Rent escalation less than or equal to RPI

* Where the Ground Rent escalation is linked to the value of the building, please provide the following:
- How is the value of the block/unit currently calculated and if the assessment relates to the block(s), how is the Ground Rent calculated/apportioned per property?
- The current valuation and Ground Rent for each unit
- What is the mechanism for future valuations of the block and how is the Ground Rent calculated/apportioned?
- What is the right of appeal? And is this a documented process within the lease?
- Who bears the cost of the valuation (and appeal) process?
- Confirmation the review period is not less than twenty years.
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.
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.

Get in touch with one of our Blakeney lease extension solicitors or enfranchisement solicitors

Lease extensions in Blakeney can be a difficult process. We recommend you procure guidance from a conveyancing solicitor and valuer well versed in the legislation and lease extension process.

We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Blakeney lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.

Blakeney Lease Extension Case Summaries:

Joshua, Blakeney, Gloucestershire

In 2014 Joshua, started to get close to the 80-year threshold with the lease on his garden flat in Blakeney. In buying his property 18 years previously, the unexpired term was of minimal bearing. Fortunately, he noticed he needed to take steps soon on a lease extension. Joshua was able to extend his lease just under the wire in September. Joshua and the landlord ultimately settled on an amount of £6,000 . If the lease had gone below 80 years, the sum would have increased by a minimum £1,000.

Blakeney case:

In 2012 we were phoned by Mr Joseph White who, having moved into a one bedroom apartment in Blakeney in August 1998. We are asked if we could approximate the price could be to prolong the lease by 90 years. Identical properties in Blakeney with an extended lease were worth £285,000. The mid-range amount of ground rent was £55 collected quarterly. The lease terminated in 2101. Having 80 years remaining we estimated the premium to the landlord to extend the lease to be between £12,400 and £14,200 plus fees.

Blakeney case:

In 2014 we were contacted by Dr Benjamin González who, having took over the lease of a ground floor apartment in Blakeney in November 2000. We are asked if we could estimate the premium would be to extend the lease by ninety years. Similar properties in Blakeney with an extended lease were in the region of £200,800. The average amount of ground rent was £65 collected yearly. The lease end date was on 8 February 2081. Taking into account 60 years unexpired we calculated the compensation to the freeholder to extend the lease to be between £20,900 and £24,200 plus expenses.