It’s an underpublicised certainty that a Darwen residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Darwen property prices.Once your lease nears 85ish years, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls under eighty years - otherwise a higher amount will be payable. Most leasehold owners in Darwen will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm whether you qualify for an extension. In some situations 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 conveyancing solicitor for the duration of the formalities.
It is conventional wisdom that a property with over one hundred years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years remaining, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a freeholder in Darwen,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Darwen valuers.
In the wake of eight months of unsuccessful discussions with the landlord of her purpose-built flat in Darwen, Niamh initiated the lease extension process as the eighty year deadline was rapidly advancing. The legal work was concluded in January 2008. The landlord’s charges were kept to an absolute minimum.
In 2012 we were contacted by Mr and Mrs. W Allen who, having was assigned a lease of a garden apartment in Darwen in June 2001. The dilemma was if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Comparative premises in Darwen with 100 year plus lease were in the region of £200,800. The average amount of ground rent was £65 invoiced every twelve months. The lease finished on 22 February 2085. Taking into account 60 years remaining we calculated the premium to the freeholder for the lease extension to be between £20,900 and £24,200 exclusive of expenses.
Dr Tommy Martinez moved into a ground floor flat in Darwen in January 2011. The dilemma was if we could shed any light on how much (roughly) premium could be for a 90 year lease extension. Comparable residencies in Darwen with 100 year plus lease were valued around £255,000. The average ground rent payable was £50 collected every twelve months. The lease elapsed on 4 June 2096. Considering the 71 years remaining we estimated the premium to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of expenses.