Crewkerne leases on residential properties are gradually losing value. Where your lease has about ninety years left, you should start thinking about a lease extension. If lease term is less than 80 years, you will then be required to pay 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Flat owners in Crewkerne will mostly qualify for a lease extension; however a solicitor should be able confirm if you qualify. In some situations you may not be entitled. There are also strict timetables and steps to follow once the process is initiated so it’s prudent to be guided by a conveyancer during the process.
It is generally considered that a property with in excess of one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
Irrespective of whether you are a tenant or a landlord in Crewkerne,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Crewkerne valuers.
Two years ago Logan, came critically close to the 80-year mark with the lease on his garden apartment in Crewkerne. In buying his home 18 years previously, the length of the lease was of little importance. Fortunately, he recognised he would soon be paying an escalated premium for a lease extension. Logan arranged for a lease extension just under the wire last January. Logan and the freeholder subsequently agreed on sum of £6,000 . If he had missed the deadline, the price would have escalated by at least £1,100.
In 2014 we were contacted by Mr and Mrs. G Laurent who, having acquired a newly refurbished apartment in Crewkerne in June 2009. The dilemma was if we could estimate the compensation to the landlord would likely be for a ninety year extension to my lease. Similar homes in Crewkerne with an extended lease were in the region of £173,800. The mid-range amount of ground rent was £60 invoiced quarterly. The lease ended in 2081. Having 55 years outstanding we estimated the premium to the freeholder to extend the lease to be within £31,400 and £36,200 plus professional charges.
In 2014 we were e-mailed by Mr and Mrs. F White who, having owned a garden flat in Crewkerne in June 2011. We are asked if we could shed any light on how much (approximately) compensation to the landlord could be for a ninety year lease extension. Comparable properties in Crewkerne with an extended lease were worth £235,200. The average amount of ground rent was £45 billed quarterly. The lease terminated in 2092. Taking into account 66 years outstanding we calculated the premium to the freeholder for the lease extension to be between £12,400 and £14,200 plus costs.