The basic rule is, all other things holding equal, the shorter the lease the more expensive the premium. Qualifying leaseholders in Clun may extend the lease for an additional 90 years under the 1993 Leasehold Reform Act. Please think carefully before delaying your Clun lease extension. Shelving that expense today simply increases the amount you will ultimately be required to pay for a lease extension.
It is conventional wisdom that a residential leasehold with more than one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
| 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. |
The conveyancing solicitors that we work with undertake Clun 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.
Theo was the the leasehold owner of a studio apartment in Clun on the market with a lease of fraction over 61 years left. Theo informally contacted his landlord being a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent initially set at £150 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Theo to invoke his statutory right. Theo procured expert advice and was able to make a more informed judgement and handle with the matter and ending up with a market value flat.
Mr and Mrs. N Turner completed a studio apartment in Clun in June 2005. We are asked if we could approximate the compensation to the landlord would be for a 90 year extension to my lease. Identical flats in Clun with a long lease were in the region of £260,000. The average ground rent payable was £50 invoiced monthly. The lease termination date was in 2097. Taking into account 72 years remaining we calculated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 not including costs.
Ms Caitlin Clarke owned a basement flat in Clun in September 2006. The dilemma was if we could estimate the compensation to the landlord would be for a 90 year extension to my lease. Identical flats in Clun with an extended lease were worth £261,600. The average amount of ground rent was £60 collected per annum. The lease ended in 2077. Having 52 years remaining we estimated the premium to the landlord to extend the lease to be within £39,000 and £45,000 not including fees.