As the length of the unexpired term of a Burford residential lease diminished so does its value and therefore the value of your property. Where the residual term has, over 125 years remaining then this decrease may be negligible that being said there will become a point in time when a lease has less than 80 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 main logic behind why you should consider extending without delay. Most flat owners in Burford will qualify for this right; that being said a conveyancing solicitor should be able to advise whether you are eligible to extend your lease. In certain situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
Leasehold residencies in Burford with over 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
Lease extensions in Burford can be a difficult process. We recommend you obtain guidance from a lawyer and surveyor with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Burford lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Two years ago Jayden, started to get close to the 80-year threshold with the lease on his basement apartment in Burford. Having purchased his home twenty years ago, the unexpired term was of no relevance. Fortunately, he became aware that he would imminently be paying way over the odds for a lease extension. Jayden extended the lease just ahead of time in June. Jayden and the landlord who owned the flat above ultimately settled on a premium of £5,500 . If the lease had descended lower than eighty years, the figure would have increased by at least £875.
In 2010 we were phoned by Mr Gabriel Gunderson who, having acquired a ground floor apartment in Burford in January 2006. We are asked if we could estimate the premium would likely be for a 90 year extension to my lease. Comparative homes in Burford with a long lease were worth £184,000. The mid-range ground rent payable was £55 billed per annum. The lease ended on 24 January 2079. Having 53 years outstanding we approximated the premium to the landlord for the lease extension to be within £28,500 and £33,000 plus professional charges.
In 2009 we were e-mailed by Mr and Mrs. U Carter who, having acquired a first floor apartment in Burford in March 1998. We are asked if we could estimate the price would likely be for a 90 year extension to my lease. Comparative premises in Burford with a long lease were in the region of £290,000. The average amount of ground rent was £45 invoiced annually. The lease finished in 2099. Given that there were 73 years remaining we calculated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 not including legals.