Claverley leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. It is the case that most Claverley tenants have the right to extend their lease by an additional ninety years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in Claverley you should investigate if your lease has between 70 and 90 years remaining. There are good reasons why a Claverley leaseholder with a lease having around eighty years remaining should take steps to make sure that a lease extension is put in place without delay
It is generally accepted that a property with in excess of one hundred years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 30 years unexpired, the premises will be equivalent in value to a freehold for many years ahead.
| 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; |
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Claverley can be a difficult process. We recommend you get guidance from a lawyer and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Claverley lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Off the back of protracted correspondence with the freeholder of her first floor flat in Claverley, Ellie initiated the lease extension process as the eighty year mark was fast advancing. The transaction was concluded in September 2010. The landlord’s fees were kept to an absolute minimum.
Last July we were contacted by Mr and Mrs. Y Smith , who acquired a ground floor apartment in Claverley in July 1997. The question was if we could approximate the compensation to the landlord could be to prolong the lease by an additional years. Comparative flats in Claverley with a long lease were worth £223,400. The average ground rent payable was £60 billed every twelve months. The lease ran out in 2085. Given that there were 59 years left we estimated the compensation to the landlord to extend the lease to be between £27,600 and £31,800 plus professional charges.
In 2009 we were contacted by Mr D Moreau who, having moved into a studio flat in Claverley in November 2011. The dilemma was if we could estimate the compensation to the landlord would be to prolong the lease by a further 90 years. Identical residencies in Claverley with 100 year plus lease were valued around £205,000. The mid-range amount of ground rent was £50 collected per annum. The lease ended in 2105. Taking into account 79 years as a residual term we estimated the premium to the landlord to extend the lease to be between £8,600 and £9,800 plus fees.