It’s a harsh certainty that a Drybrook residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the reduction being disguised by increases in the Drybrook property market.Once your lease gets to 85ish years, you should start thinking about 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 slips below 80 years - otherwise a higher amount will be payable. Most leasehold owners in Drybrook will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify whether you are eligibility. In some cases you may not qualify. There are also strict deadlines and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancer from beginning to end of the formalities.
Leasehold premises in Drybrook with in excess of 100 years left 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 premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges merit 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; |
| Coventry Building Society | 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. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
The conveyancers that we work with procure Drybrook lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Two years ago Connor, came critically near to the 80-year threshold with the lease on his purpose- built apartment in Drybrook. Having bought his flat two decades ago, the unexpired term was of minimal importance. As luck would have it, he recognised he needed to take action soon on a lease extension. Connor was able to extend his lease just under the wire in January. Connor and the landlord subsequently settled on an amount of £5,000 . If he failed to meet the deadline, the price would have increased by at least £950.
Dr N Gray owned a garden flat in Drybrook in March 1995. We are asked if we could shed any light on how much (approximately) price could be for a ninety year lease extension. Comparable residencies in Drybrook with an extended lease were in the region of £189,000. The mid-range ground rent payable was £55 collected quarterly. The lease ran out in 2079. Considering the 53 years outstanding we approximated the premium to the landlord to extend the lease to be between £28,500 and £33,000 exclusive of professional charges.
Mrs Chloe Jones was assigned a lease of a one bedroom flat in Drybrook in July 1996. We are asked if we could estimate the premium would be to prolong the lease by an additional years. Comparative premises in Drybrook with an extended lease were valued about £290,000. The mid-range ground rent payable was £45 collected yearly. The lease concluded in 2099. Taking into account 73 years remaining we approximated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 not including legals.