The nearer a domestic lease in Broadway nears to zero years unexpired, the more it reduces the value of the property. If the lease has, over 125 years remaining then this decrease may be negligible nevertheless there will become a point in time when a lease has less than eighty years unexpired as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the primary reason why you should extend the lease sooner rather than later. Most flat owners in Broadway will meet the qualifying criteria; nevertheless a conveyancing solicitor will be able to confirm if you qualify for a lease extension. In certain situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
It is generally accepted that a property with over one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 45 years unexpired, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| 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. |
Regardless of whether you are a tenant or a landlord in Broadway,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Broadway valuers.
Two years ago Theo, started to get close to the eighty-year mark with the lease on his ground floor flat in Broadway. Having purchased his property twenty years previously, the unexpired term was of little importance. Thankfully, he realised he would soon be paying way over the odds for a lease extension. Theo extended the lease at the eleventh hour in August. Theo and the freeholder eventually settled on the final figure of £5,500 . If he failed to meet the deadline, the price would have gone up by at least £950.
Last Autumn we were called by Dr T Moreau , who purchased a purpose-built apartment in Broadway in May 2008. The dilemma was if we could approximate the price would be to extend the lease by ninety years. Comparable premises in Broadway with 100 year plus lease were valued about £295,000. The average amount of ground rent was £45 invoiced quarterly. The lease elapsed in 2099. Considering the 74 years outstanding we approximated the premium to the landlord for the lease extension to be within £8,600 and £9,800 not including fees.
In 2012 we were phoned by Dr C Clarke who, having purchased a one bedroom flat in Broadway in January 2012. We are asked if we could approximate the compensation to the landlord could be to prolong the lease by a further 90 years. Comparative flats in Broadway with an extended lease were valued about £248,000. The average ground rent payable was £65 invoiced quarterly. The lease termination date was on 25 February 2088. Taking into account 63 years left we approximated the compensation to the landlord for the lease extension to be between £20,900 and £24,200 not including fees.