It’s an underpublicised certainty that a Darley Abbey residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the loss of value being disguised by increases in the Darley Abbey property prices.Once your lease nears 85ish years, you need to start considering a lease extension. If lease term dips below 80 years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property The majority of flat owners in Darley Abbey will be able to extend under the legislation; however a lawyer should be able to confirm whether you qualify for an extension. In some cases you may not qualify. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer for the duration of the process.
It is generally accepted that a residential leasehold with over one hundred years remaining is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| 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. |
| 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 | 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:
|
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Lease extensions in Darley Abbey can be a difficult process. We recommend you procure guidance from a conveyancing solicitor and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Darley Abbey lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last October Edward, came very near to the eighty-year threshold with the lease on his garden flat in Darley Abbey. Having purchased his home two decades ago, the length of the lease was of no importance. Fortunately, he noticed he would imminently be paying way over the odds for a lease extension. Edward extended the lease at the eleventh hour in September. Edward and the landlord ultimately settled on a premium of £5,500 . If the lease had slid lower than eighty years, the figure would have gone up by a minimum £1,000.
Last Autumn we were approach by Mr and Mrs. D Brooks , who completed a first floor apartment in Darley Abbey in March 2005. We are asked if we could shed any light on how much (roughly) premium would be for a 90 year extension to my lease. Comparative flats in Darley Abbey with an extended lease were in the region of £174,200. The average amount of ground rent was £55 billed quarterly. The lease finished in 2077. Having 51 years remaining we approximated the premium to the freeholder to extend the lease to be within £31,400 and £36,200 exclusive of expenses.
Last Autumn we were contacted by Mr and Mrs. T Brooks , who owned a basement flat in Darley Abbey in February 2012. The question was if we could estimate the premium would likely be to prolong the lease by 90 years. Identical flats in Darley Abbey with an extended lease were valued about £285,000. The mid-range ground rent payable was £45 billed per annum. The lease finished in 2097. Given that there were 71 years as a residual term we approximated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 not including expenses.