Earley leases on domestic properties are gradually losing value. if your lease has about 90 years left, you should start thinking about a lease extension. 80 years is a significant number: when the remaining term of a lease falls below this level then you start incurring an additional element called marriage value. Flat owners in Earley will usually qualify for a lease extension; however It would be wise to check with a conveyancer to check if you qualify. In some situations you may not qualify. There are also strict deadlines and steps to comply with once the process has commenced so it’s prudent to be guided by a conveyancer during the process.
It is conventional wisdom that a residential leasehold with in excess of 100 years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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; |
| 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. |
| 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. |
Engaging our service gives you better control over the value of your Earley leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
After lengthy correspondence with the landlord of her two bedroom flat in Earley, Charlotte commenced the lease extension process as the 80 year deadline was rapidly nearing. The legal work was concluded in January 2009. The freeholder’s fees were negotiated to approximately six hundred GBP.
Mrs Jade Girard bought a one bedroom apartment in Earley in July 2012. The question was if we could approximate the price would be for a 90 year extension to my lease. Comparable homes in Earley with an extended lease were worth £275,000. The average amount of ground rent was £65 invoiced annually. The lease ended in 2094. Given that there were 68 years outstanding we calculated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of fees.
In 2013 we were phoned by Dr Theo Roberts who, having was assigned a lease of a first floor flat in Earley in January 2011. The dilemma was if we could estimate the premium could be to extend the lease by an additional years. Comparative flats in Earley with an extended lease were worth £213,600. The mid-range ground rent payable was £60 invoiced monthly. The lease came to a finish on 6 May 2083. Given that there were 57 years unexpired we estimated the premium to the landlord to extend the lease to be between £30,400 and £35,200 not including legals.