Chellaston leases on residential properties are gradually losing value. if your lease has approximately 90 years unexpired, you should start thinking about a lease extension. If lease term is less than eighty years, you will then have to pay 50% of the property's 'marriage value' in addition to the standard cost of the lease extension to your landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Flat owners in Chellaston will usually be legally entitled to a lease extension; however a solicitor will confirm your eligibility. In some situations you may not qualify. There are also strict timetables and procedures to comply with once the process has started so it’s prudent to be guided by a lawyer during the process.
It is generally accepted that a property with in excess of one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 45 years unexpired, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Engaging our service will provide you better control over the value of your Chellaston leasehold, as your property will be more valuable and saleable in respect of 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.
Ollie owned a 2 bedroom apartment in Chellaston on the market with a lease of a little over sixty years left. Ollie on an informal basis approached his freeholder a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent to start with set at £150 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Ollie to invoke his statutory right. Ollie procured expert advice and was able to make an informed judgement and deal with the matter and ending up with a market value flat.
Dr T Cox was assigned a lease of a one bedroom flat in Chellaston in May 2010. The question was if we could shed any light on how much (roughly) price would likely be to extend the lease by 90 years. Similar residencies in Chellaston with an extended lease were in the region of £285,000. The mid-range ground rent payable was £55 invoiced yearly. The lease expiry date was on 23 April 2104. Taking into account 79 years as a residual term we estimated the compensation to the landlord for the lease extension to be between £13,300 and £15,400 not including costs.
Last year we were approach by Ms Tia Lefèvre , who took over the lease of a first floor apartment in Chellaston in January 1997. We are asked if we could estimate the premium would likely be to extend the lease by an additional years. Similar homes in Chellaston with a long lease were worth £193,400. The mid-range amount of ground rent was £65 collected yearly. The lease ended in 2084. Having 59 years unexpired we calculated the compensation to the landlord for the lease extension to be within £21,900 and £25,200 plus fees.