It’s a harsh certainty that a Clevedon residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the depreciation being disguised by increases in the Clevedon property market.Where your lease has approximately 90 years left, you need to start thinking about a lease extension. If lease term slips below eighty years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of flat owners in Clevedon will be able to extend under the legislation; however a conveyancer will be able to confirm whether you qualify for an extension. In some situations you may not qualify. There are also strict timetables and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
It is conventional wisdom that a residential leasehold with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
| 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 |
| Yorkshire Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
Irrespective of whether you are a tenant or a freeholder in Clevedon,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Clevedon valuers.
Nathaniel was the the leasehold proprietor of a high value flat in Clevedon on the market with a lease of fraction over fifty eight years remaining. Nathaniel informally spoke with his landlord being a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent initially set at £150 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Nathaniel to exercise his statutory right. Nathaniel procured expert advice and secured an acceptable resolution informally and readily saleable.
In 2013 we were phoned by Mr and Mrs. S Harris who, having moved into a one bedroom apartment in Clevedon in May 1996. We are asked if we could approximate the premium would be to extend the lease by ninety years. Similar flats in Clevedon with a long lease were valued around £225,400. The average ground rent payable was £45 billed annually. The lease concluded on 5 May 2090. Taking into account 64 years outstanding we calculated the premium to the freeholder to extend the lease to be between £15,200 and £17,600 not including expenses.
In 2010 we were called by Mrs R Lee who, having moved into a one bedroom flat in Clevedon in June 2010. The question was if we could approximate the premium would be for a 90 year lease extension. Identical flats in Clevedon with an extended lease were in the region of £270,000. The mid-range ground rent payable was £55 invoiced quarterly. The lease elapsed in 2101. Considering the 75 years left we approximated the premium to the landlord to extend the lease to be within £9,500 and £11,000 exclusive of legals.