There is no doubt about it a leasehold flat or house in Ellesmere is a wasting asset as a result of the diminishing lease term. If the residual term has, in excess of 99 years remaining then this decrease may be negligible that being said there will become a point in time when a lease has less than 80 years left as part of the premium you will incur is what is termed as a marriage value. This could increase sharply the cost. It is the primary rational as to why you should consider extending sooner as opposed to later. Many flat owners in Ellesmere will meet the qualifying criteria; however a lawyer will be able to advise whether you qualify for a lease extension. In certain situations you may not qualify, the most common reason being that you have owned the property for less than two years.
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 90 years added to any lease with more than 45 years left, the property will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Leeds Building Society | 85 years remaining from the start 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service gives you better control over the value of your Ellesmere leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Last Autumn Edward, came perilously close to the 80-year threshold with the lease on his basement apartment in Ellesmere. Having bought his property 18 years ago, the unexpired term was of minimal concern. Thankfully, he became aware that he would imminently be paying an escalated premium for Extending the lease. Edward was able to extend his lease just under the wire last July. Edward and the landlord subsequently agreed on the final figure of £5,500 . If the lease had dipped below 80 years, the sum would have gone up by at least £1,000.
Mrs Katie Watson moved into a recently refurbished apartment in Ellesmere in July 2000. The question was if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Identical properties in Ellesmere with a long lease were valued around £250,000. The mid-range amount of ground rent was £50 invoiced monthly. The lease elapsed on 22 February 2093. Considering the 68 years unexpired we estimated the compensation to the landlord for the lease extension to be within £10,500 and £12,000 not including professional charges.
Last Summer we were e-mailed by Mr and Mrs. J Carter , who took over the lease of a recently refurbished flat in Ellesmere in March 2009. The dilemma was if we could approximate the premium could be to prolong the lease by ninety years. Comparable premises in Ellesmere with an extended lease were valued around £285,000. The average ground rent payable was £55 invoiced monthly. The lease lapsed in 2104. Given that there were 79 years unexpired we estimated the premium to the freeholder for the lease extension to be between £13,300 and £15,400 plus expenses.