When it comes to long leasehold premises in Chapeltown, you effectively rent it for a certain amount of time. These days flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you may consider a lease extension sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease gets disproportionately more expensive notably once there are less than 80 years remaining. Leasehold owners in Chapeltown with a lease drawing near to 81 years remaining should seriously think of extending it as soon as possible. Once the lease term has under eighty years outstanding, under the current Act the freeholder is entitled to calculate and demand a larger premium, assessed on a technical computation, strangely termed as “marriage value” which is due.
It is generally considered that a property with over one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 45 years remaining, the premises will be equivalent in value to 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | 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. |
Regardless of whether you are a tenant or a freeholder in Chapeltown,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Chapeltown valuers.
In 2014 Jamie, started to get close to the eighty-year mark with the lease on his one bedroom flat in Chapeltown. In buying his property two decades ago, the lease term was of no bearing. by good luck, he became aware that he needed to take steps soon on Extending the lease. Jamie arranged for a lease extension just under the wire in June. Jamie and the freeholder via the managing agents subsequently settled on a premium of £5,000 . If the lease had slipped to less than 80 years, the sum would have gone up by at least £925.
Last June we were phoned by Ms E Clarke , who bought a newly refurbished flat in Chapeltown in March 2002. We are asked if we could approximate the premium would likely be to prolong the lease by ninety years. Similar homes in Chapeltown with an extended lease were worth £210,000. The mid-range ground rent payable was £50 invoiced every twelve months. The lease lapsed in 2105. Given that there were 80 years outstanding we estimated the compensation to the landlord to extend the lease to be within £8,600 and £9,800 not including expenses.
Last Summer we were approach by Dr Andrew Nelson , who bought a recently refurbished apartment in Chapeltown in August 2000. We are asked if we could estimate the compensation to the landlord would be for a ninety year lease extension. Comparative flats in Chapeltown with an extended lease were worth £275,000. The mid-range ground rent payable was £45 collected every twelve months. The lease expired on 4 January 2094. Having 69 years as a residual term we approximated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 exclusive of costs.