Owning a apartment usually means owning a lease of the property, which has a set term of years. The lease will normally be granted for a fixed period of time , usually 99 or 125 years, although we have come across longer and shorter terms in Darnall. Inevitably, the period of lease left reduces over time. This may slip by relatively unnoticed when the property needs to be disposed of or re-mortgaged. The fewer the years remaining the lower the value of the property and the more expensive it will be to obtain a lease extension. Qualifying long lease owners in Darnall have the right to extend the lease for a further ninety years under Leasehold Reform legislation. Do give due deliberation before putting off your Darnall lease extension. Putting off that expense now likely increases the price you will ultimately incur to extend your lease
It is generally considered that a residential leasehold with more than 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 35 years left, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Godiva Mortgages | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | 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. |
| 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. |
Irrespective of whether you are a tenant or a landlord in Darnall,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Darnall valuers.
Lewis was the the leasehold proprietor of a 2 bedroom flat in Darnall being sold with a lease of a little over sixty years remaining. Lewis informally approached his freeholder a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent at the outset set at £200 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Lewis to invoke his statutory right. Lewis procured expert legal guidance and was able to make a more informed decision and handle with the matter and sell the flat.
In 2012 we were e-mailed by Dr D Michel who, having purchased a garden apartment in Darnall in September 1996. The question was if we could shed any light on how much (approximately) price would be for a 90 year lease extension. Identical flats in Darnall with a long lease were in the region of £183,600. The mid-range amount of ground rent was £65 invoiced per annum. The lease finished in 2082. Given that there were 57 years unexpired we approximated the premium to the freeholder to extend the lease to be within £28,500 and £33,000 not including costs.
Last Winter we were e-mailed by Ms V Rose , who acquired a first floor apartment in Darnall in July 2009. We are asked if we could estimate the premium would likely be to prolong the lease by a further 90 years. Similar residencies in Darnall with 100 year plus lease were worth £245,000. The mid-range amount of ground rent was £50 invoiced monthly. The lease expiry date was on 7 September 2093. Considering the 68 years as a residual term we approximated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 not including costs.