The basic rule is, all other things holding equal, the shorter the lease the more expensive the premium. Qualifying leaseholders in Canvey Island have the legal entitlement to extend the lease for an additional 90 years under legislation. Do think carefully before delaying your Canvey Island lease extension. Shelving that expense today simply increases the price you will eventually have to pay to extend the lease.
Leasehold premises in Canvey Island with in excess of one hundred years remaining 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 purchasing the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
Retaining our service will provide you better control over the value of your Canvey Island leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to protracted correspondence with the freeholder of her one bedroom flat in Canvey Island, Abigail commenced the lease extension process as the 80 year threshold was quickly nearing. The lease extension was concluded in March 2013. The landlord’s costs were restricted to under 650 pounds.
In 2014 we were contacted by Dr N Lewis who, having owned a basement apartment in Canvey Island in November 2009. We are asked if we could approximate the price would likely be to extend the lease by 90 years. Comparative flats in Canvey Island with a long lease were in the region of £174,200. The mid-range ground rent payable was £55 collected monthly. The lease elapsed in 2076. Given that there were 51 years unexpired we approximated the premium to the landlord for the lease extension to be within £31,400 and £36,200 exclusive of fees.
Mrs Stephanie Richardson owned a garden flat in Canvey Island in January 2003. The question was if we could estimate the premium would likely be to extend the lease by 90 years. Identical properties in Canvey Island with an extended lease were valued about £285,000. The mid-range amount of ground rent was £45 collected yearly. The lease terminated on 24 September 2096. Taking into account 71 years remaining we estimated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 exclusive of expenses.