It’s a harsh truth that a Doncaster 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 depreciation being disguised by increases in the Doncaster property prices.Where your lease has approximately ninety years left, you should start thinking about a lease extension. If the number of years remaining drops below 80 years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of leasehold owners in Doncaster will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify whether you are eligibility. In some situations you may not be entitled. There are also strict timeframes and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the process.
Leasehold properties in Doncaster with in excess of 100 years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service gives you enhanced control over the value of your Doncaster leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Tommy owned a 2 bedroom apartment in Doncaster being sold with a lease of a few days over 61 years remaining. Tommy informally spoke with his freeholder a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £150 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Tommy to exercise his statutory right. Tommy obtained expert advice and secured an acceptable deal without resorting to tribunal and ending up with a market value flat.
Mr N Harris bought a ground floor flat in Doncaster in October 2003. We are asked if we could estimate the compensation to the landlord could be for a ninety year extension to my lease. Identical premises in Doncaster with an extended lease were worth £255,000. The mid-range ground rent payable was £50 invoiced yearly. The lease elapsed in 2096. Considering the 70 years left we calculated the compensation to the freeholder to extend the lease to be within £10,500 and £12,000 exclusive of fees.
In 2012 we were contacted by Mrs Ella Nguyen who, having bought a recently refurbished apartment in Doncaster in January 2004. The dilemma was if we could estimate the price could be to prolong the lease by 90 years. Identical premises in Doncaster with a long lease were in the region of £246,800. The average amount of ground rent was £60 invoiced annually. The lease came to a finish on 14 September 2076. Given that there were 50 years unexpired we calculated the compensation to the landlord for the lease extension to be within £44,700 and £51,600 plus expenses.