Chesham leases on domestic properties are gradually losing value. Where your lease has about 90 years remaining, you should start thinking about a lease extension. If lease term falls under eighty years, you will then have to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Leasehold owners in Chesham will mostly be legally entitled to a lease extension; however it’s a good idea to check with a conveyancing solicitor to confirm if you qualify. In certain circumstances you may not qualify. There are also strict timetables and procedures to follow once the process has started so it’s sensible to be guided by a conveyancing solicitor during the process.
It is conventional wisdom that a property with more than 100 years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
Regardless of whether you are a tenant or a landlord in Chesham,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Chesham valuers.
Oliver owned a studio flat in Chesham on the market with a lease of a few days over sixty years outstanding. Oliver informally approached his landlord being a well known Bristol-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years on the basis of an increased rent to £200 annually. No ground rent would be due on a lease extension were Oliver to exercise his statutory right. Oliver obtained expert advice and was able to make a more informed decision and handle with the matter and sell the flat.
Last Spring we were e-mailed by Dr Evan Campbell , who purchased a newly refurbished apartment in Chesham in May 1995. We are asked if we could shed any light on how much (approximately) premium could be for a ninety year extension to my lease. Identical homes in Chesham with a long lease were valued around £280,000. The mid-range ground rent payable was £55 billed per annum. The lease came to a finish in 2103. Having 78 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 exclusive of costs.
Last month we were called by Dr S Leroy , who bought a basement apartment in Chesham in July 2006. The dilemma was if we could approximate the premium could be for a ninety year extension to my lease. Similar properties in Chesham with a long lease were in the region of £191,000. The mid-range amount of ground rent was £65 collected every twelve months. The lease ran out in 2083. Taking into account 58 years remaining we calculated the premium to the freeholder to extend the lease to be between £23,800 and £27,400 not including professional charges.