Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will normally be granted for a fixed period of time , usually 99 or 125 years, although we have seen longer and shorter terms in Crick. Clearly, the period of lease remaining shortens as time goes by. This is often ignored and only raises itself as an issue when the residence has to be disposed of or refinanced. The shorter the lease the less it is worth and the more it will cost to extend the lease. Eligible leaseholders in Crick have the legal entitlement to extend the lease for an additional ninety years in accordance with Leasehold Reform legislation. Please give due consideration before delaying your Crick lease extension. Holding off the cost now likely increases the price you will ultimately have to pay to extend your lease
It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| 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; |
| 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. |
| Halifax | Minimum 70 years from the date 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a freeholder in Crick,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Crick valuers.
Lucas owned a studio apartment in Crick on the market with a lease of fraction over 61 years left. Lucas informally contacted his freeholder a well known local-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent to start with set at £100 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Lucas to exercise his statutory right. Lucas obtained expert advice and secured satisfactory deal without resorting to tribunal and readily saleable.
Last month we were contacted by Dr F Bernard , who acquired a newly refurbished flat in Crick in July 1999. We are asked if we could shed any light on how much (approximately) price would likely be to extend the lease by an additional years. Comparative residencies in Crick with 100 year plus lease were in the region of £254,200. The average amount of ground rent was £60 billed monthly. The lease ended in 2076. Having 51 years as a residual term we calculated the compensation to the freeholder for the lease extension to be between £43,700 and £50,600 plus costs.
Mr and Mrs. V Carter acquired a one bedroom flat in Crick in August 2012. We are asked if we could estimate the premium would likely be for a 90 year lease extension. Comparable properties in Crick with an extended lease were worth £215,600. The average ground rent payable was £45 collected yearly. The lease ran out on 13 April 2087. Considering the 62 years remaining we approximated the premium to the freeholder for the lease extension to be between £18,100 and £20,800 plus expenses.