When it comes to long leasehold premises in Broadstairs, you are actually purchasing a right to reside in a property for a prescribed time frame. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you may consider a lease extension sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly notably when there are less than 80 years left. Residents in Broadstairs with a lease drawing near to 81 years unexpired should seriously think of extending it without delay. When the lease term has below eighty years outstanding, under the current legislation the landlord is entitled to calculate and charge a greater amount, assessed on a technical calculation, strangely termed as “marriage value” which is payable.
It is conventional wisdom that a property with more than one hundred years remaining is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 30 years remaining, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| 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 remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with procure Broadstairs 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 conveyancer we work with provide it.
Off the back of unsuccessful correspondence with the freeholder of her studio apartment in Broadstairs, Molly started the lease extension process as the eighty year mark was rapidly advancing. The lease extension was finalised in April 2005. The freeholder’s fees were kept to an absolute minimum.
Last Winter we were called by Mr Finn Lefebvre , who acquired a studio apartment in Broadstairs in March 2007. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be for a ninety year lease extension. Comparable homes in Broadstairs with an extended lease were worth £233,200. The average ground rent payable was £60 billed per annum. The lease elapsed in 2087. Given that there were 61 years unexpired we calculated the premium to the freeholder to extend the lease to be within £22,800 and £26,400 exclusive of professional charges.
Ms L Pérez owned a ground floor flat in Broadstairs in July 2005. We are asked if we could approximate the price would likely be for a 90 year extension to my lease. Identical properties in Broadstairs with an extended lease were worth £171,800. The average amount of ground rent was £55 invoiced monthly. The lease terminated in 2076. Given that there were 50 years remaining we calculated the premium to the freeholder for the lease extension to be between £33,300 and £38,400 plus expenses.