Burnley leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Burnley residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Burnley you should check if your lease has between 70 and ninety years remaining. There are compelling reasons why a Burnley leaseholder with a lease having around eighty years left should take steps to ensure that a lease extension is effected without delay
It is generally considered that a property with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 45 years left, 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. |
| 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 Burnley,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 Burnley valuers.
After protracted discussions with the landlord of her first floor flat in Burnley, Alicia commenced the lease extension process just as her lease was coming close to the crucial 80-year threshold. The transaction was concluded in May 2008. The landlord’s costs were kept to an absolute minimum.
Ms Sophia Smith purchased a newly refurbished flat in Burnley in July 2006. The dilemma was if we could approximate the compensation to the landlord could be to extend the lease by ninety years. Similar homes in Burnley with 100 year plus lease were worth £260,000. The average amount of ground rent was £50 invoiced monthly. The lease ran out on 7 January 2098. Considering the 72 years left we estimated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 not including fees.
Dr D Clarke purchased a ground floor apartment in Burnley in November 2000. We are asked if we could approximate the premium would likely be to prolong the lease by a further 90 years. Comparable homes in Burnley with an extended lease were worth £261,600. The mid-range ground rent payable was £60 invoiced monthly. The lease ended on 19 August 2078. Given that there were 52 years unexpired we approximated the premium to the freeholder for the lease extension to be between £39,000 and £45,000 not including legals.