Unfortunately that a Eynsham residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Eynsham property prices.Once your lease nears 85ish years, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips lower than 80 years - otherwise a higher premium will be payable. Most flat owners in Eynsham will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify if you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your conveyancer from beginning to end of 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 additional ninety years added to all but the shortest lease, the property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
The conveyancing solicitors that we work with handle Eynsham lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancing solicitor we work with provide it.
Two years ago Thomas, came critically near to the 80-year threshold with the lease on his one bedroom flat in Eynsham. In buying his property twenty years previously, the length of the lease was of little importance. Thankfully, he recognised he needed to take steps soon on a lease extension. Thomas extended the lease just under the wire in May. Thomas and the freeholder in the end settled on an amount of £6,000 . If he failed to meet the deadline, the figure would have escalated by a minimum £975.
Mrs C Ramírez was assigned a lease of a one bedroom apartment in Eynsham in November 2009. The question was if we could estimate the price could be for a ninety year lease extension. Identical residencies in Eynsham with an extended lease were in the region of £235,600. The average amount of ground rent was £60 invoiced every twelve months. The lease ended on 22 September 2088. Considering the 62 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £21,900 and £25,200 exclusive of fees.
Last Summer we were called by Dr Noah Ward , who acquired a garden flat in Eynsham in January 2009. The dilemma was if we could estimate the price would likely be for a ninety year lease extension. Comparative properties in Eynsham with a long lease were valued about £174,200. The mid-range amount of ground rent was £55 invoiced yearly. The lease end date was on 19 January 2077. Taking into account 51 years left we approximated the premium to the landlord to extend the lease to be between £31,400 and £36,200 plus fees.