It’s a harsh certainty that a Charlbury residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Charlbury property market.Once your lease gets to 85ish years, you should start thinking about 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 slips under eighty years - otherwise a higher amount will be due. The majority of leasehold owners in Charlbury will be able to extend under the legislation; however a lawyer should be able to clarify if you qualify for an extension. In some cases you may not qualify. There are also strict timeframes and procedures to follow once the process has commenced and you will need to be guided by your conveyancer throughout the process.
It is generally accepted that a residential leasehold with in excess of 100 years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you increased control over the value of your Charlbury leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Finley owned a high value flat in Charlbury on the market with a lease of a few days over 72 years remaining. Finley informally contacted his landlord being a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a new rent to start with set at £150 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Finley to exercise his statutory right. Finley procured expert legal guidance and was able to make a more informed decision and deal with the matter and ending up with a market value flat.
Last Autumn we were called by Dr Ryan Jackson , who moved into a ground floor apartment in Charlbury in January 1997. We are asked if we could shed any light on how much (roughly) price would likely be for a 90 year lease extension. Comparative residencies in Charlbury with a long lease were valued around £218,000. The mid-range amount of ground rent was £45 invoiced per annum. The lease expired in 2088. Given that there were 63 years as a residual term we estimated the premium to the landlord for the lease extension to be between £17,100 and £19,800 not including fees.
In 2012 we were e-mailed by Dr L Leroy who, having purchased a purpose-built apartment in Charlbury in September 1999. We are asked if we could estimate the price would likely be to extend the lease by 90 years. Similar properties in Charlbury with a long lease were in the region of £270,000. The mid-range amount of ground rent was £55 billed yearly. The lease expiry date was on 24 May 2099. Having 74 years as a residual term we approximated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 plus expenses.