Downton leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Downton residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Downton you really ought to see if your lease has between seventy and 90 years left. There are good reasons why a Downton flat owner with a lease having around eighty years remaining should take steps to make sure that a lease extension is effected without delay
Leasehold premises in Downton with over 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in purchasing 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
Using our service will provide you increased control over the value of your Downton leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
In 2014 Elijah, started to get close to the eighty-year threshold with the lease on his first floor apartment in Downton. In buying his property two decades ago, the unexpired term was of little bearing. by good luck, he noticed he would imminently be paying way over the odds for a lease extension. Elijah was able to extend his lease just in the nick of time last June. Elijah and the freeholder via the managing agents ultimately settled on an amount of £6,000 . If the lease had slid below 80 years, the sum would have increased by at least £950.
Dr Austin Wood completed a studio flat in Downton in July 2002. The dilemma was if we could approximate the price would likely be for a 90 year extension to my lease. Identical premises in Downton with 100 year plus lease were in the region of £285,000. The average ground rent payable was £55 billed every twelve months. The lease terminated on 28 January 2106. Having 80 years remaining we approximated the compensation to the landlord for the lease extension to be between £12,400 and £14,200 plus legals.
Last Summer we were approach by Mr and Mrs. R Cooper , who took over the lease of a basement apartment in Downton in June 2003. The question was if we could approximate the compensation to the landlord would be to prolong the lease by an additional years. Identical homes in Downton with 100 year plus lease were in the region of £200,800. The mid-range amount of ground rent was £65 collected yearly. The lease elapsed in 2086. Taking into account 60 years remaining we approximated the compensation to the landlord for the lease extension to be within £20,900 and £24,200 not including costs.