Danescourt leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Most owners of residential leasehold property in Danescourt enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Danescourt you should see if your lease has between 70 and 90 years left. There are good reasons why a Danescourt leaseholder with a lease having around eighty years left should take steps to ensure that a lease extension is actioned without delay
Leasehold properties in Danescourt 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 property. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and maintenance charges warrant it.
| 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; |
| 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. |
| 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 |
| 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 Danescourt,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Danescourt valuers.
Liam owned a conversion flat in Danescourt being sold with a lease of just over 59 years unexpired. Liam informally spoke with his freeholder a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent at the outset set at £200 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Liam to exercise his statutory right. Liam procured expert legal guidance and was able to make a more informed decision and handle with the matter and sell the property.
In 2009 we were phoned by Dr Austin André who, having owned a basement flat in Danescourt in August 2000. We are asked if we could approximate the premium would be for a 90 year extension to my lease. Identical properties in Danescourt with an extended lease were worth £300,000. The mid-range ground rent payable was £50 billed monthly. The lease lapsed on 14 January 2101. Given that there were 76 years unexpired we calculated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 exclusive of fees.
In 2011 we were approached by Mr Mason Mason who, having purchased a purpose-built apartment in Danescourt in March 1995. We are asked if we could estimate the premium would likely be to prolong the lease by 90 years. Comparative premises in Danescourt with a long lease were in the region of £257,800. The average amount of ground rent was £65 collected annually. The lease ended on 13 October 2090. Having 65 years outstanding we calculated the premium to the landlord for the lease extension to be within £18,100 and £20,800 plus fees.