It’s a harsh certainty that a Burton upon Stather residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the early years due to the deflation being disguised by increases in the Burton upon Stather property market.Where your lease has approximately ninety years left, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips lower than 80 years - otherwise a higher premium will be due. Most leasehold owners in Burton upon Stather will be able to extend under the legislation; however a conveyancer should be able to confirm if you are eligibility. In some cases you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancing solicitor throughout the formalities.
Leasehold premises in Burton upon Stather with in excess of one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 lawyers that we work with undertake Burton upon Stather 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.
Dexter was the the leasehold proprietor of a 2 bedroom apartment in Burton upon Stather being sold with a lease of fraction over sixty years remaining. Dexter on an informal basis approached his landlord a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to an increased rent to £50 yearly. Ordinarily, ground rent would not be due on a lease extension were Dexter to invoke his statutory right. Dexter obtained expert advice and secured an acceptable deal informally and sell the property.
Last year we were e-mailed by Mrs Courtney Collins , who bought a one bedroom flat in Burton upon Stather in March 2006. We are asked if we could estimate the price could be to extend the lease by an additional years. Comparable properties in Burton upon Stather with 100 year plus lease were worth £174,200. The average amount of ground rent was £55 invoiced monthly. The lease elapsed in 2077. Considering the 51 years unexpired we approximated the premium to the freeholder for the lease extension to be between £31,400 and £36,200 plus legals.
In 2010 we were approached by Dr V David who, having moved into a first floor flat in Burton upon Stather in February 2005. The question was if we could estimate the premium would likely be for a ninety year lease extension. Comparable residencies in Burton upon Stather with an extended lease were worth £285,000. The average ground rent payable was £45 collected quarterly. The lease ran out in 2097. Having 71 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 exclusive of fees.