With a residential leasehold property in Earlswood, you are in fact renting it for a certain period of time. These days flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you may consider a lease extension sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly particularly when there are less than eighty years remaining. Anyone in Earlswood with a lease approaching 81 years unexpired should seriously consider extending it without delay. When a lease has below 80 years outstanding, under the current Act the freeholder is entitled to calculate and charge a greater premium, based on a technical computation, strangely termed as “marriage value” which is payable.
Leasehold properties in Earlswood with over 100 years unexpired 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 circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Retaining our service will provide you enhanced control over the value of your Earlswood leasehold, as your property will be more valuable and saleable in respect of lease length should you wish 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 protracted correspondence with the freeholder of her two bedroom apartment in Earlswood, Alicia initiated the lease extension process just as her lease was coming close to the crucial eighty-year mark. The transaction was concluded in May 2012. The freeholder’s charges were restricted to approximately 600 GBP.
Dr Jessica Adams completed a purpose-built apartment in Earlswood in August 2002. We are asked if we could estimate the price could be to extend the lease by 90 years. Comparative flats in Earlswood with an extended lease were worth £267,600. The average ground rent payable was £65 collected every twelve months. The lease terminated in 2092. Taking into account 67 years left we estimated the compensation to the landlord for the lease extension to be between £14,300 and £16,400 plus fees.
In 2013 we were phoned by Mr Oscar Nguyen who, having moved into a one bedroom flat in Earlswood in July 2007. The question was if we could shed any light on how much (roughly) premium would be to extend the lease by 90 years. Similar properties in Earlswood with an extended lease were worth £206,200. The mid-range ground rent payable was £55 billed quarterly. The lease concluded in 2081. Taking into account 56 years outstanding we approximated the premium to the freeholder for the lease extension to be within £31,400 and £36,200 not including professional charges.