Unfortunately that a Ferndale residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Ferndale property market.Where your lease has approximately 90 years left, you should start considering a lease extension. If the number of years remaining drops under eighty years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of flat owners in Ferndale will be able to extend under the legislation; however a lawyer should be able to confirm whether you are eligibility. In some situations you may not be entitled. There are also strict timeframes and procedures to follow once the process is initiated and you will need to be guided by your lawyer from beginning to end of the formalities.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
The lawyers that we work with procure Ferndale 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.
Half a year ago Blake, started to get close to the 80-year mark with the lease on his garden apartment in Ferndale. Having purchased his home two decades ago, the length of the lease was of little relevance. Luckily, he recognised he would imminently be paying way over the odds for a lease extension. Blake extended the lease just under the wire last March. Blake and the freeholder via the management company ultimately agreed on the final figure of £6,000 . If the lease had gone below eighty years, the price would have gone up by a minimum £900.
Last Winter we were approach by Mr W Flores , who owned a basement apartment in Ferndale in November 1996. The dilemma was if we could shed any light on how much (approximately) premium would likely be for a 90 year extension to my lease. Identical flats in Ferndale with 100 year plus lease were worth £225,800. The mid-range ground rent payable was £60 collected quarterly. The lease ran out on 4 February 2085. Having 60 years as a residual term we calculated the compensation to the landlord to extend the lease to be within £24,700 and £28,600 not including fees.
In 2013 we were phoned by Mr and Mrs. I Bernard who, having owned a purpose-built flat in Ferndale in September 1999. We are asked if we could estimate the premium would likely be for a ninety year extension to my lease. Identical properties in Ferndale with a long lease were in the region of £210,000. The mid-range ground rent payable was £50 invoiced quarterly. The lease terminated in 2105. Considering the 80 years left we calculated the compensation to the freeholder to extend the lease to be within £8,600 and £9,800 plus costs.