Fairbourne leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. It is the case that most Fairbourne tenants have the right to extend their lease by an additional 90 years under the 1993 Leasehold Reform Act. If you are a leasehold owner in Fairbourne you would be well advised to investigate if your lease has between 70 and ninety years left. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension sharply increases as an element of the premium you will incur is what is known as a marriage value
It is conventional wisdom that a property with more than 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 35 years remaining, the property will be equivalent in value to a freehold for many years in the future.
| 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. |
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
Lease extensions in Fairbourne can be a difficult process. We recommend you secure guidance from a conveyancing solicitor and valuer well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Fairbourne lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Jasper owned a high value flat in Fairbourne being marketed with a lease of fraction over sixty years remaining. Jasper on an informal basis contacted his freeholder being a well known London-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent to start with set at £200 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Jasper to exercise his statutory right. Jasper obtained expert legal guidance and was able to make a more informed decision and deal with the matter and ending up with a market value flat.
Last Summer we were approach by Mr and Mrs. W Gray , who acquired a recently refurbished flat in Fairbourne in June 2003. The question was if we could estimate the compensation to the landlord would be to prolong the lease by a further 90 years. Similar residencies in Fairbourne with an extended lease were worth £186,000. The average amount of ground rent was £65 invoiced annually. The lease expired in 2084. Considering the 58 years remaining we estimated the compensation to the landlord to extend the lease to be between £24,700 and £28,600 exclusive of fees.
Last Autumn we were e-mailed by Mr and Mrs. G Murphy , who took over the lease of a studio apartment in Fairbourne in April 1995. The dilemma was if we could shed any light on how much (approximately) premium could be to prolong the lease by ninety years. Comparable properties in Fairbourne with an extended lease were in the region of £250,000. The average amount of ground rent was £50 invoiced every twelve months. The lease lapsed on 27 February 2095. Having 69 years unexpired we estimated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 exclusive of fees.