Boston leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. The majority of owners of residential leasehold property in Boston enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Boston you would be well advised to investigate if your lease has between seventy and 90 years remaining. There are good reasons why a Boston flat owner with a lease having around 80 years left should take steps to ensure that a lease extension is put in place without delay
It is conventional wisdom that a residential leasehold with more than 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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 procure Boston 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.
Andrew owned a conversion apartment in Boston being marketed with a lease of a little over sixty years remaining. Andrew informally contacted his landlord being a well known Manchester-based freehold company for a lease extension. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £200 annually. Ordinarily, ground rent would not be due on a lease extension were Andrew to exercise his statutory right. Andrew obtained expert advice and secured an acceptable deal without resorting to tribunal and sell the property.
Last year we were approach by Mrs M Moreau , who purchased a one bedroom flat in Boston in July 2006. We are asked if we could estimate the price would be to extend the lease by a further 90 years. Similar homes in Boston with a long lease were worth £242,600. The mid-range ground rent payable was £45 collected quarterly. The lease concluded on 19 August 2093. Considering the 67 years as a residual term we estimated the compensation to the freeholder to extend the lease to be between £11,400 and £13,200 plus legals.
Dr Ethan López took over the lease of a one bedroom apartment in Boston in June 1999. The question was if we could estimate the compensation to the landlord would likely be to prolong the lease by an additional years. Comparable properties in Boston with an extended lease were valued around £280,000. The mid-range amount of ground rent was £55 invoiced per annum. The lease lapsed on 23 November 2104. Having 78 years as a residual term we estimated the compensation to the landlord for the lease extension to be within £13,300 and £15,400 not including legals.