When it comes to long leasehold property in Clent, you are actually buying a right to reside in a property for a set period of time. In recent years flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you should consider a lease extension sooner rather than later. Accepted thinking is that the shorter the number of years is the cost of extending the lease gets disproportionately more expensive notably once there are less than 80 years left. Anyone in Clent with a lease drawing near to 81 years unexpired should seriously think of extending it without delay. When the lease term has under 80 years remaining, under the current legislation the landlord is entitled to calculate and charge a greater amount, assessed on a technical multiplication, strangely termed as “marriage value” which is due.
It is generally accepted that a residential leasehold with over one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, 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 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with undertake Clent lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Leo was the the leasehold owner of a studio flat in Clent on the market with a lease of fraction over 59 years left. Leo on an informal basis contacted his freeholder being a well known Manchester-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent to start with set at £200 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Leo to invoke his statutory right. Leo procured expert advice and secured satisfactory deal informally and ending up with a market value flat.
In 2010 we were called by Dr John Stewart who, having owned a studio flat in Clent in May 1997. We are asked if we could shed any light on how much (approximately) premium could be for a ninety year extension to my lease. Comparative homes in Clent with a long lease were in the region of £166,800. The average ground rent payable was £50 billed quarterly. The lease finished on 27 June 2075. Given that there were 50 years left we estimated the compensation to the landlord to extend the lease to be within £32,300 and £37,400 plus professional charges.
In 2014 we were called by Mrs Jennifer Lefebvre who, having acquired a one bedroom flat in Clent in November 2009. The dilemma was if we could approximate the premium would likely be for a 90 year extension to my lease. Identical homes in Clent with an extended lease were valued about £280,000. The mid-range amount of ground rent was £45 invoiced monthly. The lease expired in 2095. Having 70 years left we calculated the compensation to the landlord for the lease extension to be between £12,400 and £14,200 plus costs.