When it comes to domestic leasehold property in Clifton Village, you effectively rent it for a certain period of time. Modern flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you should consider extending the lease sooner rather than later. The general rule is that the shorter the number of years is the cost of extending the lease becomes disproportionately greater particularly when there are fewer than eighty years remaining. Leasehold owners in Clifton Village with a lease nearing 81 years left should seriously think of extending it without delay. When a lease has below 80 years left, under the current legislation the landlord can calculate and levy a greater premium, assessed on a technical multiplication, known as “marriage value” which is payable.
It is conventional wisdom that a property with in excess of 100 years unexpired lease term is worth roughly 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 |
|---|---|
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
The conveyancers that we work with handle 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.
Off the back of lengthy correspondence with the freeholder of her two bedroom flat in Clifton Village, Ellie commenced the lease extension process as the eighty year mark was rapidly coming. The legal work completed in November 2010. The freeholder’s fees were kept to an absolute minimum.
Mr and Mrs. E Bennett owned a ground floor apartment in Clifton Village in November 2005. The question was if we could approximate the price would likely be to extend the lease by an additional years. Identical properties in Clifton Village with a long lease were valued about £186,000. The mid-range amount of ground rent was £65 collected annually. The lease elapsed in 2083. Having 58 years left we estimated the premium to the freeholder for the lease extension to be within £24,700 and £28,600 not including professional charges.
Last Autumn we were approach by Mr and Mrs. K Smith , who bought a garden apartment in Clifton Village in March 2008. The dilemma was if we could estimate the premium could be for a ninety year lease extension. Identical residencies in Clifton Village with a long lease were worth £250,000. The mid-range amount of ground rent was £50 collected quarterly. The lease expired on 22 August 2094. Given that there were 69 years outstanding we estimated the premium to the landlord for the lease extension to be within £9,500 and £11,000 plus costs.