With a domestic leasehold property in Gosforth, you are actually buying an entitlement to live in a property for a set 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 consider extending the lease sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly especially when there are fewer than 80 years left. Leasehold owners in Gosforth with a lease nearing 81 years left should seriously think of extending it without delay. Once the lease term has less than eighty years left, under the current statute the landlord can calculate and demand a larger premium, based on a technical multiplication, strangely termed as “marriage value” which is payable.
Leasehold premises in Gosforth with in excess of 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges merit it.
| 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. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Irrespective of whether you are a tenant or a landlord in Gosforth,the lease extension experts 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 Gosforth valuers.
During the course of the last few months Max, came seriously near to the eighty-year threshold with the lease on his two bedroom apartment in Gosforth. Having bought his home two decades ago, the lease term was of minimal bearing. Fortunately, he noticed he needed to take action soon on a lease extension. Max arranged for a lease extension just under the wire last July. Max and the landlord subsequently agreed on sum of £5,000 . If he failed to meet the deadline, the price would have become more exhorbitant by a minimum £1,025.
Ms Natasha Morel took over the lease of a ground floor flat in Gosforth in September 2010. The dilemma was if we could approximate the premium would likely be to extend the lease by ninety years. Identical residencies in Gosforth with 100 year plus lease were valued about £285,000. The mid-range ground rent payable was £45 collected quarterly. The lease ran out in 2097. Taking into account 72 years remaining we estimated the compensation to the freeholder for the lease extension to be within £12,400 and £14,200 exclusive of legals.
Last year we were contacted by Mr and Mrs. L Girard , who purchased a garden flat in Gosforth in January 2008. We are asked if we could estimate the price would likely be for a ninety year extension to my lease. Identical premises in Gosforth with 100 year plus lease were in the region of £233,200. The mid-range ground rent payable was £60 collected per annum. The lease terminated in 2086. Given that there were 61 years as a residual term we estimated the premium to the landlord for the lease extension to be between £22,800 and £26,400 exclusive of fees.