Dursley leases on residential properties are gradually decreasing 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 Dursley residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Dursley you must see if your lease has between seventy and ninety years left. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension increases dramatically as part of the premium you will incur is what is known as a marriage value
It is conventional wisdom that a residential leasehold with more than one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to any lease with more than 30 years unexpired, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
Regardless of whether you are a tenant or a landlord in Dursley,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Dursley valuers.
Last Christmas Freddie, started to get close to the eighty-year mark with the lease on his studio flat in Dursley. In buying his flat twenty years previously, the unexpired term was of little relevance. Luckily, he realised he needed to take steps soon on a lease extension. Freddie arranged for a lease extension just under the wire in April. Freddie and the freeholder via the management company in the end settled on sum of £5,500 . If he not met the deadline, the price would have become more costly by at least £1,000.
In 2009 we were approached by Dr I Fournier who, having took over the lease of a purpose-built apartment in Dursley in April 1995. The question was if we could estimate the compensation to the landlord would be for a 90 year extension to my lease. Similar properties in Dursley with an extended lease were valued around £176,200. The mid-range ground rent payable was £65 billed yearly. The lease elapsed in 2081. Given that there were 56 years as a residual term we approximated the premium to the landlord for the lease extension to be within £29,500 and £34,000 not including expenses.
Mr and Mrs. G Simon purchased a first floor apartment in Dursley in January 2008. We are asked if we could approximate the premium would be for a 90 year lease extension. Comparable flats in Dursley with an extended lease were in the region of £242,600. The average ground rent payable was £45 collected monthly. The lease lapsed in 2092. Given that there were 67 years remaining we estimated the compensation to the freeholder for the lease extension to be within £11,400 and £13,200 plus expenses.