With a long leasehold property in Earlswood, you effectively rent it for a certain period of time. Modern flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you should consider extending the lease sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately greater especially once there are fewer than eighty years remaining. Anyone in Earlswood with a lease approaching 81 years remaining should seriously consider extending it as soon as possible. When a lease has less than 80 years left, under the relevant legislation the landlord can calculate and levy a greater amount, based on a technical calculation, known as “marriage value” which is payable.
It is conventional wisdom that a property with more than 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| 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. |
| 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Retaining our service gives you better control over the value of your Earlswood leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
During the course of the last few months Archie, came dangerously near to the 80-year threshold with the lease on his garden apartment in Earlswood. Having bought his home twenty years ago, the lease term was of minimal significance. Luckily, he recognised he would soon be paying way over the odds for Extending the lease. Archie was able to extend his lease just under the wire in May. Archie and the freeholder ultimately settled on the final figure of £6,000 . If the lease had gone lower than 80 years, the amount would have escalated by at least £1,050.
Last Summer we were contacted by Ms Maisie García , who purchased a purpose-built flat in Earlswood in January 2012. The question was if we could estimate the compensation to the landlord would likely be to prolong the lease by a further 90 years. Similar premises in Earlswood with 100 year plus lease were worth £300,000. The average ground rent payable was £50 billed annually. The lease expired on 19 June 2102. Taking into account 76 years left we calculated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 not including expenses.
In 2014 we were contacted by Mr and Mrs. M Norbert who, having owned a first floor flat in Earlswood in February 2006. The question was if we could estimate the price would likely be for a 90 year extension to my lease. Comparative properties in Earlswood with a long lease were in the region of £257,800. The mid-range amount of ground rent was £65 billed yearly. The lease ran out on 12 July 2091. Considering the 65 years unexpired we approximated the premium to the landlord to extend the lease to be within £18,100 and £20,800 not including expenses.