When it comes to long leasehold premises in Darley Abbey, you are actually buying an entitlement to reside in a property for a prescribed time frame. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you may consider a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease gets disproportionately greater particularly once there are less than eighty years left. Residents in Darley Abbey with a lease drawing near to 81 years remaining should seriously consider extending it sooner rather than later. When a lease has less than eighty years left, under the current Act the landlord is entitled to calculate and levy a greater amount, based on a technical multiplication, strangely termed as “marriage value” which is payable.
It is conventional wisdom that a residential leasehold with in excess of one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to any lease with more than 35 years unexpired, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Bank of Scotland | 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. |
| 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. |
| 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 Darley Abbey,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 Darley Abbey valuers.
During the course of the last few months Luca, started to get near to the eighty-year threshold with the lease on his garden apartment in Darley Abbey. Having bought his home two decades ago, the length of the lease was of little interest. As luck would have it, it dawned on him that he would soon be paying an escalated premium for Extending the lease. Luca was able to extend his lease just under the wire in May. Luca and the freeholder via the management company subsequently settled on an amount of £6,000 . If he had missed the deadline, the price would have become more costly by a minimum £1,000.
Last year we were phoned by Mr and Mrs. F Young , who acquired a basement apartment in Darley Abbey in July 2007. The question was if we could shed any light on how much (roughly) price could be to prolong the lease by an additional years. Similar flats in Darley Abbey with a long lease were worth £225,800. The mid-range amount of ground rent was £60 billed every twelve months. The lease ended in 2084. Taking into account 60 years left we approximated the premium to the landlord for the lease extension to be within £23,800 and £27,400 plus fees.
Ms Kate Howard completed a purpose-built apartment in Darley Abbey in January 2005. We are asked if we could estimate the compensation to the landlord could be for a 90 year extension to my lease. Identical properties in Darley Abbey with 100 year plus lease were valued about £210,000. The average ground rent payable was £50 invoiced quarterly. The lease expired on 16 October 2104. Having 80 years as a residual term we estimated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 exclusive of expenses.