With a domestic leasehold property in Fulwell, you effectively rent it for a certain period of time. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you should think about extending the lease sooner rather than later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly especially when there are less than eighty years remaining. Leasehold owners in Fulwell with a lease approaching 81 years remaining should seriously consider extending it without delay. Once the lease term has below 80 years left, under the current legislation the freeholder is entitled to calculate and levy a larger amount, assessed on a technical calculation, known as “marriage value” which is payable.
It is conventional wisdom that a residential leasehold with more than one hundred years remaining is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Fulwell,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Fulwell valuers.
In 2014 Kian, started to get close to the 80-year threshold with the lease on his first floor flat in Fulwell. In buying his property two decades ago, the lease term was of no importance. As luck would have it, he realised he needed to take action soon on Extending the lease. Kian arranged for a lease extension just under the wire in June. Kian and the freeholder ultimately settled on the final figure of £6,000 . If the lease had fallen below eighty years, the price would have become more costly by at least £850.
In 2011 we were e-mailed by Dr T Turner who, having was assigned a lease of a purpose-built apartment in Fulwell in January 2005. We are asked if we could estimate the price would be to extend the lease by a further 90 years. Identical flats in Fulwell with a long lease were valued around £275,000. The mid-range ground rent payable was £55 invoiced every twelve months. The lease elapsed on 14 February 2101. Taking into account 76 years unexpired we estimated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 exclusive of professional charges.
An example of a Lease Extension decision for a Fulwell residence is Ground Floor Flat 91 Bath Road in May 2009. in a case where the freeholder could not be traced, the Brentford County Court ordered that the Lease be surrendered in return for the grant of a new lease of the Premises at a premium determined by the Leasehold Valuation Tribunal. The tribunal concluded that the price payable by the Applicant for the new lease of the premises be £15,900 This case related to 1 flat. The unexpired lease term was 60.45 years.