Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will usually be granted for a fixed period of time , ordinarily 99 or 125 years, although we have come across longer and shorter terms in Chester le Street. Inevitably, the length of lease left reduces over time. This may slip by relatively unnoticed when the residence needs to be sold or re-mortgaged. The fewer the years remaining the less it is worth and the more expensive it will be to procure a lease extension. Qualifying leaseholders in Chester le Street have the legal entitlement to extend the lease for an additional ninety years under legislation. Please give due attention before putting off your Chester le Street lease extension. Holding off the cost now likely increases the price you will ultimately incur to extend your lease
Leasehold properties in Chester le Street with over one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Irrespective of whether you are a tenant or a landlord in Chester le Street,the lease extension lawyers 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 Chester le Street valuers.
Twenty four months ago Archie, came seriously close to the 80-year mark with the lease on his leasehold apartment in Chester le Street. Having bought his home two decades ago, the length of the lease was of little importance. Luckily, he became aware that he needed to take action soon on Extending the lease. Archie was able to extend his lease at the eleventh hour in March. Archie and the freeholder via the management company ultimately settled on a premium of £5,000 . If he failed to meet the deadline, the sum would have become more exhorbitant by at least £950.
In 2014 we were contacted by Dr A Sánchez who, having acquired a purpose-built apartment in Chester le Street in May 2008. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be to prolong the lease by an additional years. Comparative residencies in Chester le Street with a long lease were in the region of £280,000. The average amount of ground rent was £55 billed yearly. The lease expired on 8 July 2104. Taking into account 78 years as a residual term we calculated the compensation to the landlord for the lease extension to be between £13,300 and £15,400 plus costs.
Ms O Campbell owned a basement flat in Chester le Street in October 2011. The question was if we could approximate the compensation to the landlord could be for a ninety year lease extension. Comparative residencies in Chester le Street with 100 year plus lease were valued about £186,000. The average ground rent payable was £65 invoiced every twelve months. The lease expired in 2084. Having 58 years left we calculated the compensation to the landlord to extend the lease to be within £24,700 and £28,600 not including costs.