There is no doubt about it a leasehold flat or house in Four Oaks is a wasting asset as a result of the diminishing lease term. If the lease has, in excess of one hundred years to run then this decrease may be fractional that being said there will become a stage when a lease has under than 80 years unexpired as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main reason why you should consider extending without delay. Most flat owners in Four Oaks will meet the qualifying criteria; that being said a lawyer should be able to advise whether you qualify for a lease extension. In certain situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Using our service gives you better control over the value of your Four Oaks leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Freddie owned a 2 bedroom apartment in Four Oaks on the market with a lease of just over fifty eight years remaining. Freddie on an informal basis contacted his freeholder being a well known Bristol-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent to start with set at £100 per annum and increase every 25 years thereafter. No ground rent would be payable on a lease extension were Freddie to exercise his statutory right. Freddie procured expert advice and secured satisfactory deal informally and readily saleable.
Last June we were phoned by Ms O Roberts , who was assigned a lease of a first floor flat in Four Oaks in October 2004. The dilemma was if we could approximate the premium would be for a 90 year lease extension. Comparative flats in Four Oaks with a long lease were valued around £295,000. The average ground rent payable was £45 billed yearly. The lease terminated on 8 September 2100. Having 75 years remaining we estimated the premium to the landlord for the lease extension to be within £8,600 and £9,800 plus costs.
Last July we were contacted by Dr Dexter Morris , who moved into a recently refurbished flat in Four Oaks in May 2011. We are asked if we could estimate the premium would be for a ninety year extension to my lease. Comparative properties in Four Oaks with an extended lease were valued about £250,400. The mid-range ground rent payable was £65 collected every twelve months. The lease ended in 2089. Taking into account 64 years outstanding we approximated the compensation to the landlord to extend the lease to be between £19,000 and £22,000 plus expenses.