There is no doubt about it a leasehold property in Burford is a wasting asset as a result of the shortening lease. Where the residual term has, over 99 years to run then this decrease may be negligible nevertheless there will become a stage when a lease has fewer than eighty years left as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the primary logic behind why you should extend the lease sooner than later. The majority of flat owners in Burford will meet the qualifying criteria; nevertheless a conveyancer can advise whether you qualify to extend your lease. In limited situations you may not qualify, the most frequent 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 roughly the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 |
| 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. |
The conveyancing solicitors that we work with undertake Burford 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 lawyer we work with provide it.
Kian was the the leasehold owner of a conversion apartment in Burford on the market with a lease of fraction over 61 years outstanding. Kian informally contacted his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £200 yearly. Ordinarily, ground rent would not be due on a lease extension were Kian to invoke his statutory right. Kian procured expert legal guidance and secured satisfactory resolution without resorting to tribunal and sell the flat.
Last Spring we were e-mailed by Dr Oliver Khan , who owned a one bedroom apartment in Burford in October 1996. The dilemma was if we could approximate the premium would likely be for a 90 year extension to my lease. Comparative residencies in Burford with 100 year plus lease were worth £198,800. The mid-range amount of ground rent was £55 billed quarterly. The lease came to a finish on 5 June 2080. Taking into account 55 years outstanding we estimated the premium to the landlord to extend the lease to be between £33,300 and £38,400 not including legals.
In 2010 we were phoned by Mr F Davies who, having took over the lease of a basement flat in Burford in March 2008. The question was if we could approximate the price could be for a 90 year lease extension. Comparative properties in Burford with 100 year plus lease were valued around £295,000. The mid-range amount of ground rent was £45 billed every twelve months. The lease terminated on 4 February 2100. Given that there were 75 years outstanding we estimated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 exclusive of professional charges.