When it comes to residential leasehold property in Downton, you are in fact renting it for a certain amount of time. Modern flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you should consider a lease extension sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly notably when there are less than eighty years remaining. Anyone in Downton with a lease nearing 81 years remaining should seriously consider extending it sooner as opposed to later. Once a lease has fewer than 80 years left, under the current Act the landlord is entitled to calculate and demand a greater amount, based on a technical multiplication, strangely termed as “marriage value” which is due.
Leasehold properties in Downton with in excess of one hundred years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Birmingham Midshires | 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. |
| 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 Downton,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 experience and the close ties they enjoy with Downton valuers.
14 months ago Leon, came critically near to the eighty-year mark with the lease on his basement flat in Downton. Having bought his flat 19 years previously, the length of the lease was of minimal significance. Luckily, he became aware that he would soon be paying an inflated amount for Extending the lease. Leon extended the lease just under the wire in April. Leon and the freeholder subsequently agreed on the final figure of £5,000 . If he not met the deadline, the figure would have become more costly by at least £1,100.
In 2009 we were e-mailed by Ms Hannah Nelson who, having was assigned a lease of a ground floor apartment in Downton in October 2007. We are asked if we could approximate the price could be to extend the lease by a further 90 years. Comparable homes in Downton with 100 year plus lease were valued around £166,400. The mid-range ground rent payable was £60 invoiced quarterly. The lease lapsed in 2079. Having 54 years outstanding we estimated the premium to the freeholder for the lease extension to be between £32,300 and £37,400 exclusive of fees.
In 2013 we were approached by Mrs D Murphy who, having took over the lease of a purpose-built flat in Downton in January 1997. The dilemma was if we could estimate the compensation to the landlord would be for a 90 year lease extension. Similar properties in Downton with a long lease were worth £227,800. The mid-range amount of ground rent was £45 invoiced annually. The lease expired in 2090. Taking into account 65 years remaining we approximated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 plus fees.