Crowthorne leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease becomes more expensive. Most owners of residential leasehold property in Crowthorne enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Crowthorne you really ought to check if your lease has between 70 and 90 years left. In particular once the remaining lease term slips under 80 years, the cost of any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
Leasehold residencies in Crowthorne with more than one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
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The conveyancing solicitors that we work with handle Crowthorne 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 conveyancer we work with provide it.
Muhammad was the the leasehold proprietor of a conversion flat in Crowthorne on the market with a lease of a little over sixty years remaining. Muhammad informally spoke with his freeholder a well known local-based freehold company and enquired on a premium to extend the lease. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £200 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Muhammad to exercise his statutory right. Muhammad obtained expert legal guidance and secured satisfactory deal without resorting to tribunal and ending up with a market value flat.
Last Winter we were phoned by Mr V Stewart , who owned a garden flat in Crowthorne in January 2010. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be for a ninety year extension to my lease. Comparative premises in Crowthorne with 100 year plus lease were valued around £270,000. The mid-range amount of ground rent was £55 invoiced annually. The lease came to a finish in 2101. Taking into account 75 years outstanding we approximated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 exclusive of professional charges.
Mrs V Murphy purchased a garden apartment in Crowthorne in April 2001. The dilemma was if we could approximate the compensation to the landlord could be to extend the lease by ninety years. Comparable homes in Crowthorne with an extended lease were worth £173,800. The average ground rent payable was £60 invoiced every twelve months. The lease lapsed on 8 April 2081. Having 55 years outstanding we approximated the premium to the landlord to extend the lease to be between £31,400 and £36,200 plus fees.