Flackwell Heath leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Flackwell Heath residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Flackwell Heath you would be well advised to check if your lease has between seventy and ninety years left. In particular once the remaining lease term slips under 80 years, the amount payable for any lease extension increases dramatically as part of the premium you pay is what is known as a marriage value
It is generally considered that a property with more than one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years remaining, the property will be worth the same as a freehold for many years ahead.
| 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 should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| 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. |
| Yorkshire 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. |
Irrespective of whether you are a tenant or a landlord in Flackwell Heath,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Flackwell Heath valuers.
Half a year ago Adam, started to get close to the eighty-year threshold with the lease on his one bedroom flat in Flackwell Heath. In buying his home 19 years previously, the lease term was of minimal interest. by good luck, he became aware that he would imminently be paying way over the odds for Extending the lease. Adam extended the lease at the eleventh hour in January. Adam and the landlord eventually settled on a premium of £5,000 . If he failed to meet the deadline, the sum would have increased by a minimum £1,125.
In 2010 we were approached by Mr and Mrs. K Mitchell who, having acquired a ground floor apartment in Flackwell Heath in September 2007. The question was if we could approximate the premium would be for a 90 year lease extension. Similar homes in Flackwell Heath with a long lease were valued about £290,000. The average ground rent payable was £45 billed yearly. The lease finished in 2098. Given that there were 73 years outstanding we approximated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 plus costs.
Last Summer we were phoned by Dr N Anderson , who purchased a purpose-built flat in Flackwell Heath in October 2005. The question was if we could estimate the premium would be to extend the lease by a further 90 years. Similar properties in Flackwell Heath with 100 year plus lease were worth £240,600. The mid-range ground rent payable was £60 collected monthly. The lease ran out in 2087. Taking into account 62 years left we calculated the compensation to the freeholder to extend the lease to be within £21,900 and £25,200 not including fees.