Unfortunately that a Brigg residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Brigg property prices.Where your lease has approximately ninety years left, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls under eighty years - otherwise a higher premium will be due. The majority of leasehold owners in Brigg will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify if you qualify for an extension. In some cases you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancer from beginning to end of the process.
It is generally accepted that a residential leasehold with over one hundred years unexpired lease term is worth roughly 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 |
|---|---|
| Accord Mortgages | 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
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| 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. |
Using our service will provide you increased control over the value of your Brigg leasehold, as your property will be more valuable and saleable in respect 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.
Luca owned a high value flat in Brigg on the market with a lease of a little over 61 years remaining. Luca on an informal basis approached his landlord being a well known local-based freehold company and enquired on a premium to extend the lease. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £150 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Luca to exercise his statutory right. Luca procured expert advice and was able to make an informed decision and deal with the matter and ending up with a market value flat.
Mrs Maisie Hall was assigned a lease of a one bedroom flat in Brigg in February 2011. The question was if we could shed any light on how much (roughly) premium would likely be for a ninety year extension to my lease. Comparable properties in Brigg with an extended lease were in the region of £261,600. The mid-range amount of ground rent was £60 billed annually. The lease finished on 22 January 2078. Considering the 52 years outstanding we calculated the premium to the freeholder for the lease extension to be within £39,000 and £45,000 not including professional charges.
Mr and Mrs. A Rodríguez purchased a one bedroom apartment in Brigg in August 1997. We are asked if we could shed any light on how much (roughly) premium would likely be to extend the lease by an additional years. Comparable properties in Brigg with 100 year plus lease were valued around £218,000. The mid-range ground rent payable was £45 collected monthly. The lease expiry date was in 2089. Given that there were 63 years remaining we calculated the premium to the landlord for the lease extension to be between £17,100 and £19,800 plus expenses.