There is no doubt about it a leasehold property in Brading is a wasting asset as a result of the shortening lease. If the lease has, in excess of one hundred years remaining then this decrease may be of little impact nevertheless there will become a point in time when a lease has fewer than eighty years unexpired as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main reason why you should consider extending without delay. The majority of flat owners in Brading will qualify for this right; however a conveyancer will be able to advise whether 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 under two years.
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 45 years left, the residence will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Leeds Building Society | 85 years remaining from the start 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Engaging our service gives you increased control over the value of your Brading leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Jackson was the the leasehold owner of a conversion flat in Brading being marketed with a lease of fraction over 59 years unexpired. Jackson on an informal basis approached his freeholder a well known Manchester-based freehold company for a lease extension. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £200 yearly. No ground rent would be payable on a lease extension were Jackson to exercise his statutory right. Jackson procured expert advice and secured an acceptable deal informally and readily saleable.
In 2012 we were called by Mr and Mrs. G Patel who, having acquired a purpose-built apartment in Brading in February 2008. We are asked if we could estimate the compensation to the landlord could be to prolong the lease by an additional years. Identical flats in Brading with 100 year plus lease were worth £300,000. The average amount of ground rent was £50 collected annually. The lease termination date was in 2101. Considering the 75 years unexpired we calculated the premium to the landlord for the lease extension to be within £8,600 and £9,800 not including legals.
In 2009 we were approached by Ms Eleanor Bailey who, having owned a ground floor apartment in Brading in October 2011. We are asked if we could approximate the premium would likely be for a ninety year extension to my lease. Comparable residencies in Brading with a long lease were valued about £250,400. The mid-range ground rent payable was £65 collected annually. The lease finished on 18 May 2090. Having 64 years as a residual term we approximated the premium to the freeholder to extend the lease to be within £19,000 and £22,000 exclusive of professional charges.