Flitwick 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 gets more expensive. Legislation has been in place for sometime now which entitles qualifying Flitwick residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Flitwick you would be well advised to see if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under 80 years, the amount payable for any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be worth the same as a freehold for decades to come.
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
The lawyers that we work with undertake Flitwick 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 conveyancer we work with provide it.
In recent months Alexander, started to get close to the 80-year mark with the lease on his first floor flat in Flitwick. In buying his property two decades ago, the length of the lease was of no relevance. by good luck, he realised he would imminently be paying way over the odds for Extending the lease. Alexander extended the lease at the eleventh hour last June. Alexander and the freeholder via the managing agents eventually agreed on the final figure of £5,500 . If the lease had slipped to less than eighty years, the premium would have increased by a minimum £1,075.
Last Christmas we were e-mailed by Dr U Robinson , who acquired a garden flat in Flitwick in February 2002. We are asked if we could approximate the premium would be for a ninety year extension to my lease. Comparable properties in Flitwick with an extended lease were valued around £171,800. The mid-range ground rent payable was £55 billed per annum. The lease finished on 16 March 2075. Having 50 years as a residual term we calculated the premium to the landlord for the lease extension to be within £32,300 and £37,400 exclusive of expenses.
Ms Leah André owned a one bedroom flat in Flitwick in February 2003. The question was if we could estimate the premium could be to extend the lease by an additional years. Comparative premises in Flitwick with an extended lease were in the region of £280,000. The average ground rent payable was £45 billed per annum. The lease finished on 11 November 2095. Given that there were 70 years unexpired we calculated the compensation to the landlord to extend the lease to be between £12,400 and £14,200 plus professional charges.