As the the remaining lease term of a Burslem residential lease decreases so does its value and therefore the value of your property. If the lease has, in excess of 100 years remaining then this decrease may be fractional however there will become a point in time when a lease has less than eighty years remaining as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the primary rational as to why you should consider extending sooner rather than later. The majority of flat owners in Burslem will meet the qualifying criteria; however a conveyancing solicitor can confirm whether you qualify for a lease extension. 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.
It is generally accepted that a residential leasehold with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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; |
| Godiva Mortgages | 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. |
| 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. |
Engaging our service will provide you enhanced control over the value of your Burslem leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
18 months ago David, started to get close to the eighty-year threshold with the lease on his first floor flat in Burslem. In buying his property 19 years previously, the length of the lease was of little importance. Fortunately, it dawned on him that he needed to take steps soon on Extending the lease. David extended the lease at the eleventh hour last April. David and the freeholder eventually settled on sum of £6,000 . If he failed to meet the deadline, the amount would have gone up by a minimum £975.
Last Autumn we were approach by Mrs Jodie Davies , who moved into a studio apartment in Burslem in November 1996. We are asked if we could estimate the compensation to the landlord could be to prolong the lease by ninety years. Comparable properties in Burslem with a long lease were valued around £246,800. The mid-range ground rent payable was £60 billed yearly. The lease ended on 11 February 2076. Considering the 50 years as a residual term we estimated the compensation to the landlord for the lease extension to be within £44,700 and £51,600 exclusive of fees.
Last May we were approach by Mr Kai Hernández , who owned a first floor flat in Burslem in August 2009. We are asked if we could shed any light on how much (approximately) premium would be to prolong the lease by an additional years. Similar flats in Burslem with a long lease were valued around £203,200. The mid-range amount of ground rent was £65 collected monthly. The lease expiry date was in 2087. Given that there were 61 years as a residual term we approximated the compensation to the landlord for the lease extension to be between £19,000 and £22,000 exclusive of fees.