If you are facing a significant premium because your lease in Buxton has dropped toward the 80-year mark, your previous lawyer may be at fault. Our panel of experts specialise in recovering lease extension costs from negligent firms who failed to protect your investment.
Top reasons for lease extension now:
A Buxton leasehold property depreciates with the years remaining on the lease.
Buxton leases on residential deteriorating in value. if your lease has about 90 years left, you should start thinking about a lease extension. Eighty years is a significant number: when the remaining term of a lease falls below this level then you begin incurring an additional element called marriage value. Flat owners in Buxton will mostly qualify for a lease extension; however a solicitor should be able check your eligibility. In some situations you may not qualify. There are prescribed timetables and steps to comply with once the process is initiated so it’s wise to be guided by a lawyer during the process.
Buxton property with a lease extension has roughly the same value as a freehold
It is generally considered that a property with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 45 years remaining, the residence will be equivalent in value to a freehold for many years ahead.
Banks and Building Societies will not finance a property on a short lease
Mortgage lenders are less likely to give a mortgage on a residential property in Buxton with a short lease. Some lenders simply refuse to lend on leases with under 75 years left.
| Lender |
Requirement
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|---|
| 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.
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| Bank of Scotland |
Minimum 70 years from the date of the mortgage.
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| 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.
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| 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
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| The Mortgage Works |
Minimum unexpired lease term is 70 years with 30 years remaining at the end of the mortgage term.
Where the unexpired lease term is different to that recorded on the mortgage offer, the following clarifies if we need to be informed:
Second hand property:
- If the unexpired lease term on the offer is 85 years or more - only advise us if the actual lease term is less than 85 years
- if the unexpired lease term on the offer is less than 85 years – advise us if the actual lease term is different than reported
- For equity share applications - advise us if the actual lease term is different than reported on the offer
New build property:
- If the unexpired lease term stated on the offer is 125 years (flat) / 250 years (house) or more - only advise us if the actual lease term is less than 125 years (flat) / 250 years (house)
- For equity share applications - always advise us if the actual lease term is different than reported on the offer
Lease terms such as ground rent and event fees must be reasonable at all times during the term of the lease and adhere to our requirements below. If you’re unsure as to whether the terms of a lease are unreasonable or onerous, please refer the details to us in plain English for Valuer consideration. If the potentially onerous terms are in relation to the ground rent please include the current ground rent figure per annum, how often it will be reviewed and the price structure it will be reviewed against. See the guidance below.
SECOND HAND PROPERTIES
Unacceptable - advise Issuing Office (Will be declined):
- Unexpired lease term less than 70 years
- Less than 30 years remaining at the end of the mortgage term
- Ground Rent greater than 0.5% of the property value
- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more
- Ground Rent is compounded RPI
- Ground Rent review period less than or equal to 5 years
Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Unexpired lease term is 70 to 85 years
- Ground Rent greater than 0.1% and less than or equal to 0.5% of the property value
- Ground Rent escalation is linked to any indices greater than RPI
- Ground Rent escalation is linked to the value of the building*
- Ground Rent review period is greater than 5 and less than 10 years
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1.0% of property value p/a (please provide details of what the charges cover)
- Anything that appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than 85 years
- Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than or equal to 10 years
- Ground Rent escalation less than or equal to RPI
NEW BUILD PROPERTIES (includes office conversions)
Unacceptable - advise Issuing Office (will be declined):
- Unexpired lease term less than 125 years on a new build flat or less than 250 years on a new build house
- Any lease which is subject to a ground rent (or annual rent) being charged which is more than on a peppercorn basis
- Any lease which is subject to a ground rent (or annual rent) being reviewed and altered on any review basis or methodology
Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1.0% of property value p/a (please provide details of what the charges cover)
- Anything else appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than or equal to 125 years on a new build flat or greater than or equal to 250 years on a new build house
- A lease subject to a peppercorn ground rent (annual rent) charges
For the avoidance of doubt, any new build properties completed but not sold pre 30 June 2022 will only be acceptable if the lease conforms to the above guidance
* Where the Ground Rent escalation is linked to the value of the building, please provide the following:
- How is the value of the block/unit currently calculated and if the assessment relates to the block(s), how is the Ground Rent calculated/apportioned per property?
- The current valuation and Ground Rent for each unit
- What is the mechanism for future valuations of the block and how is the Ground Rent calculated/apportioned?
- What is the right of appeal? And is this a documented process within the lease?
- Who bears the cost of the valuation (and appeal) process?
- Confirmation the review period is not less than twenty years
Lease Extensions We require all Lease Extensions to be completed under the Leasehold Reform Housing and Urban Development Act 1993 and to meet the above criteria as a minimum. Where a proposed Lease Extension does not meet these requirements, however you feel that this is in the best interest for our mutual client, please refer all details to the Issuing Office for us to consider.
Please ensure that all lender enquiries are submitted (with full documentation/requirements) at least 2 weeks prior to exchange to allow sufficient time for review and decisioning.
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Get in touch with one of our Buxton lease extension solicitors or enfranchisement solicitors
Irrespective of whether you are a tenant or a landlord in Buxton,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Buxton valuers.
Buxton Lease Extension Example Cases:
George, Buxton, Derbyshire
Last year George, started to get near to the eighty-year mark with the lease on his ground floor apartment in Buxton. Having bought his home two decades ago, the lease term was of little importance. Thankfully, he became aware that he needed to take steps soon on a lease extension. George extended the lease at the eleventh hour in May. George and the freeholder via the management company eventually agreed on an amount of £5,000 . If he not met the deadline, the premium would have increased by at least £925.
Buxton case:
Mr Evan Watson completed a ground floor flat in Buxton in February 2004. The question was if we could shed any light on how much (roughly) compensation to the landlord would be to prolong the lease by a further 90 years. Similar homes in Buxton with an extended lease were in the region of £200,000. The mid-range ground rent payable was £50 collected per annum. The lease ran out in 2103. Given that there were 77 years outstanding we approximated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 plus expenses.
Buxton case:
Last October we were phoned by Mrs B Petit , who
took over the lease of a one bedroom apartment in Buxton in June 2000. The dilemma was if we could approximate the compensation to the landlord would likely be to prolong the lease by 90 years. Identical flats in Buxton with an extended lease were in the region of £265,200. The average ground rent payable was £65 billed monthly. The lease elapsed in 2092. Given that there were 66 years remaining we approximated the compensation to the landlord to extend the lease to be between £15,200 and £17,600 not including professional charges.