It’s an underpublicised truth that a Consett residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the depreciation being disguised by increases in the Consett property market.Once your lease gets to 85ish years, you need to 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 slips below 80 years - otherwise a higher amount will be payable. The majority of flat owners in Consett will be able to extend under the legislation; however a lawyer will be able to confirm if you are eligibility. In some cases you may not qualify. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor for the duration of the formalities.
It is generally considered that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 30 years unexpired, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Irrespective of whether you are a tenant or a freeholder in Consett,the lease extension lawyers 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 Consett valuers.
In 2014 George, came critically near to the 80-year threshold with the lease on his ground floor apartment in Consett. Having bought his flat two decades ago, the unexpired term was of no significance. Luckily, he became aware that he would soon be paying an inflated amount for a lease extension. George arranged for a lease extension at the eleventh hour in April. George and the freeholder via the management company ultimately settled on a premium of £5,000 . If the lease had descended below 80 years, the price would have increased by at least £850.
Mrs Louise Bertrand acquired a ground floor flat in Consett in February 2007. The question was if we could approximate the premium could be to extend the lease by 90 years. Similar homes in Consett with an extended lease were worth £200,000. The average amount of ground rent was £50 invoiced every twelve months. The lease ran out in 2103. Taking into account 78 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 plus professional charges.
Last month we were phoned by Ms Lucy Richardson , who completed a ground floor apartment in Consett in February 2007. The question was if we could approximate the compensation to the landlord could be for a ninety year extension to my lease. Comparative properties in Consett with 100 year plus lease were in the region of £267,600. The average ground rent payable was £65 invoiced monthly. The lease lapsed in 2092. Taking into account 67 years left we estimated the premium to the landlord for the lease extension to be within £14,300 and £16,400 plus costs.