As the length of the unexpired term of a Filey residential lease diminished so does its value and therefore the value of your property. If the lease has, beyond 100 years to run then this decrease may be of little impact that being said there will become a point in time when a lease has under than 80 years unexpired as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the primary reason why you should extend the lease sooner rather than later. The majority of flat owners in Filey will meet the qualifying criteria; nevertheless a lawyer will be able to advise if you are eligible 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 residential leasehold with over 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 35 years unexpired, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Engaging our service gives you better control over the value of your Filey leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Following lengthy negotiations with the freeholder of her basement flat in Filey, Samantha commenced the lease extension process just as her lease was nearing the critical 80-year deadline. The transaction was concluded in October 2012. The freeholder’s costs were kept to an absolute minimum.
Mr Cameron Young bought a purpose-built flat in Filey in October 2000. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord would be for a 90 year lease extension. Comparable residencies in Filey with an extended lease were valued around £210,000. The average ground rent payable was £50 collected quarterly. The lease ended on 5 April 2106. Having 80 years unexpired we estimated the premium to the landlord for the lease extension to be within £8,600 and £9,800 not including expenses.
In 2011 we were approached by Dr E Mason who, having moved into a newly refurbished flat in Filey in October 2010. We are asked if we could approximate the premium would be to extend the lease by 90 years. Comparative flats in Filey with an extended lease were valued around £275,000. The average ground rent payable was £45 invoiced per annum. The lease terminated in 2095. Given that there were 69 years outstanding we approximated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 not including legals.