It’s a harsh truth that a Clifton Village residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Clifton Village property prices.Once your lease gets to 85ish years, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips below 80 years - otherwise a higher amount will be due. Most leasehold owners in Clifton Village will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm whether you qualify for an extension. In some situations you may not be entitled. There are also strict timetables and procedures to follow once the process is initiated and you will need to be guided by your conveyancer for the duration of the formalities.
Leasehold premises in Clifton Village with over 100 years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with procure Clifton Village 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 conveyancing solicitor we work with provide it.
16 months ago Benjamin, came critically close to the eighty-year threshold with the lease on his garden apartment in Clifton Village. Having bought his property two decades ago, the lease term was of minimal bearing. Fortunately, he became aware that he needed to take action soon on a lease extension. Benjamin arranged for a lease extension at the eleventh hour last March. Benjamin and the landlord in the end agreed on the final figure of £5,500 . If he had missed the deadline, the figure would have increased by a minimum £950.
In 2012 we were approached by Dr Georgia Brown who, having took over the lease of a purpose-built flat in Clifton Village in October 2012. The question was if we could estimate the premium would likely be for a ninety year extension to my lease. Identical homes in Clifton Village with an extended lease were worth £227,800. The average amount of ground rent was £45 billed monthly. The lease came to a finish in 2091. Having 65 years remaining we estimated the compensation to the freeholder to extend the lease to be within £13,300 and £15,400 plus fees.
In 2011 we were approached by Ms H Wright who, having was assigned a lease of a recently refurbished flat in Clifton Village in October 2012. The question was if we could approximate the price would likely be for a 90 year extension to my lease. Identical homes in Clifton Village with an extended lease were valued around £275,000. The mid-range amount of ground rent was £55 invoiced annually. The lease ran out on 25 February 2102. Considering the 76 years left we estimated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of fees.