It’s a harsh truth that a Finchampstead residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the early years due to the reduction being disguised by increases in the Finchampstead property market.Once your lease nears 85ish years, you should start considering a lease extension. If the number of years remaining drops under 80 years, you will then be required to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property The majority of flat owners in Finchampstead will be able to extend under the legislation; however a lawyer will be able to clarify if you qualify for an extension. In some cases you may not qualify. There are also strict timetables and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer throughout the formalities.
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Bank of Scotland | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
Engaging our service gives you better control over the value of your Finchampstead leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Eli was the the leasehold proprietor of a 2 bedroom apartment in Finchampstead on the market with a lease of fraction over fifty eight years left. Eli informally contacted his freeholder being a well known Bristol-based freehold company for a lease extension. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £150 per annum and doubled every twenty five years thereafter. No ground rent would be payable on a lease extension were Eli to invoke his statutory right. Eli obtained expert legal guidance and was able to make an informed judgement and deal with the matter and sell the property.
Mrs Sian Harris completed a purpose-built apartment in Finchampstead in November 1998. We are asked if we could estimate the price could be to prolong the lease by ninety years. Comparable flats in Finchampstead with 100 year plus lease were valued about £176,200. The average ground rent payable was £65 billed quarterly. The lease lapsed in 2082. Taking into account 56 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £29,500 and £34,000 not including fees.
Last Spring we were contacted by Ms Natalie Williams , who acquired a one bedroom apartment in Finchampstead in October 2004. The dilemma was if we could approximate the price would be to prolong the lease by a further 90 years. Comparative residencies in Finchampstead with 100 year plus lease were valued about £242,600. The mid-range ground rent payable was £45 invoiced monthly. The lease expired on 13 May 2093. Considering the 67 years outstanding we estimated the compensation to the freeholder for the lease extension to be between £11,400 and £13,200 plus costs.