Elm Park leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Elm Park residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Elm Park you must check if your lease has between seventy and 90 years left. There are compelling reasons why a Elm Park flat owner with a lease having around 80 years left should take action to make sure that a lease extension is effected without delay
Leasehold residencies in Elm Park with more than one hundred years left on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Elm Park,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Elm Park valuers.
Kian was the the leasehold owner of a studio flat in Elm Park being sold with a lease of a little over fifty eight years left. Kian informally contacted his landlord being a well known Manchester-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to an increased rent to £50 per annum. No ground rent would be payable on a lease extension were Kian to invoke his statutory right. Kian obtained expert legal guidance and was able to make an informed judgement and deal with the matter and readily saleable.
In 2011 we were called by Mr Jacob Bonnet who, having purchased a basement apartment in Elm Park in June 2004. We are asked if we could shed any light on how much (approximately) premium could be to prolong the lease by 90 years. Comparable residencies in Elm Park with 100 year plus lease were in the region of £255,000. The average ground rent payable was £50 invoiced annually. The lease expiry date was on 12 November 2097. Considering the 71 years unexpired we estimated the premium to the landlord to extend the lease to be within £9,500 and £11,000 exclusive of expenses.
An example of a Lease Extension matter before the tribunal for a Elm Park flat is 37 Lodge Court High Street in November 2013. the decision of the LVT was that the premium to be paid for the new lease was £25,559 This case was in relation to 1 flat. The remaining number of years on the lease was 57.5 years.