When it comes to residential leasehold property in Chellaston, you are actually purchasing an entitlement to reside in a property for a set period of time. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you may consider extending the lease sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately greater especially once there are less than eighty years remaining. Residents in Chellaston with a lease nearing 81 years unexpired should seriously think of extending it sooner rather than later. When the lease term has below 80 years remaining, under the current Act the landlord can calculate and charge a greater premium, assessed on a technical multiplication, strangely termed as “marriage value” which is payable.
Leasehold premises in Chellaston with in excess of one hundred years outstanding 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 service charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| 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. |
| 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. |
Retaining our service gives you better control over the value of your Chellaston leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Jonathan was the the leasehold proprietor of a studio apartment in Chellaston on the market with a lease of just over 59 years left. Jonathan informally contacted his freeholder a well known London-based freehold company for a lease extension. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Jonathan to invoke his statutory right. Jonathan procured expert advice and secured an acceptable deal without going to tribunal and sell the property.
In 2011 we were e-mailed by Dr J Evans who, having acquired a purpose-built flat in Chellaston in September 1996. The question was if we could estimate the premium could be to prolong the lease by an additional years. Identical flats in Chellaston with an extended lease were valued about £254,200. The mid-range ground rent payable was £60 billed per annum. The lease terminated in 2076. Having 51 years unexpired we calculated the premium to the freeholder for the lease extension to be within £43,700 and £50,600 plus legals.
In 2011 we were approached by Dr T Bernard who, having acquired a first floor flat in Chellaston in July 1995. The dilemma was if we could estimate the price could be for a 90 year lease extension. Similar flats in Chellaston with an extended lease were in the region of £210,600. The average ground rent payable was £45 invoiced annually. The lease lapsed in 2087. Having 62 years remaining we calculated the compensation to the freeholder to extend the lease to be between £18,100 and £20,800 not including professional charges.