Brading leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Brading residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Brading you would be well advised to see if your lease has between seventy and ninety years left. In particular once the remaining lease term slips under eighty years, the amount payable for any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
Leasehold premises in Brading with more than one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a freeholder in Brading,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Brading valuers.
Last year Andrew, came perilously close to the eighty-year threshold with the lease on his ground floor flat in Brading. Having bought his flat 19 years ago, the length of the lease was of no interest. by good luck, he noticed he needed to take action soon on Extending the lease. Andrew arranged for a lease extension just ahead of time in July. Andrew and the landlord who owned the flat above ultimately agreed on sum of £5,000 . If the lease had fallen below 80 years, the price would have gone up by a minimum £850.
Last Spring we were contacted by Ms Jodie Robinson , who completed a one bedroom apartment in Brading in September 2011. We are asked if we could estimate the compensation to the landlord would be to extend the lease by a further 90 years. Identical properties in Brading with 100 year plus lease were valued around £179,200. The average amount of ground rent was £55 billed per annum. The lease came to a finish in 2077. Considering the 51 years outstanding we calculated the compensation to the landlord for the lease extension to be within £31,400 and £36,200 plus costs.
Last Spring we were e-mailed by Mr and Mrs. K Dupont , who owned a one bedroom apartment in Brading in September 1997. We are asked if we could estimate the compensation to the landlord could be for a 90 year lease extension. Comparative properties in Brading with 100 year plus lease were in the region of £285,000. The mid-range amount of ground rent was £45 invoiced per annum. The lease concluded on 1 June 2097. Having 71 years remaining we calculated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 plus fees.