There is no doubt about it a leasehold flat or house in Consett is a wasting asset as a result of the diminishing lease term. If the residual term has, beyond one hundred years remaining then this decrease may be of little impact however there will become a point in time when a lease has fewer than eighty years remaining as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main reason why you should consider extending without delay. Many flat owners in Consett will meet the qualifying criteria; however a lawyer can advise if you are eligible for a lease extension. In limited situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
Leasehold residencies in Consett with in excess of one hundred years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Regardless of whether you are a tenant or a landlord in Consett,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Consett valuers.
In recent months Kai, started to get close to the eighty-year mark with the lease on his leasehold apartment in Consett. Having bought his home two decades ago, the lease term was of no concern. As luck would have it, he became aware that he needed to take action soon on Extending the lease. Kai extended the lease just under the wire in January. Kai and the freeholder via the management company subsequently settled on an amount of £6,000 . If the lease had dipped to less than eighty years, the sum would have escalated by at least £900.
In 2010 we were contacted by Dr E Garcia who, having bought a garden apartment in Consett in May 2004. The dilemma was if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Comparative residencies in Consett with an extended lease were worth £250,400. The mid-range ground rent payable was £65 collected per annum. The lease finished on 9 September 2090. Having 64 years as a residual term we approximated the compensation to the landlord for the lease extension to be between £19,000 and £22,000 exclusive of fees.
Dr L Lambert completed a one bedroom flat in Consett in June 1999. We are asked if we could estimate the premium would likely be for a 90 year extension to my lease. Comparable homes in Consett with an extended lease were worth £189,000. The mid-range amount of ground rent was £55 invoiced quarterly. The lease ended on 7 November 2079. Considering the 53 years as a residual term we approximated the premium to the freeholder for the lease extension to be within £28,500 and £33,000 not including professional charges.