Gotham leases on residential properties are gradually losing value. Where your lease has approximately 90 years unexpired, you should start considering the need for a lease extension. Eighty years is a significant number: when the remaining term of a lease dips below this level then you begin paying an additional element called marriage value. Flat owners in Gotham will mostly be legally entitled to a lease extension; however a solicitor should be able confirm your eligibility. In certain cases you may not be entitled. There are prescribed deadlines and procedures to follow once the process is initiated so it’s sensible to be guided by a conveyancing solicitor during the process.
Leasehold premises in Gotham with in excess of 100 years remaining on the lease are often 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 freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service gives you increased control over the value of your Gotham leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Thomas was the the leasehold owner of a conversion flat in Gotham on the market with a lease of just over fifty eight years remaining. Thomas on an informal basis contacted his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Thomas to exercise his statutory right. Thomas obtained expert advice and secured satisfactory resolution informally and readily saleable.
In 2014 we were called by Dr L Reed who, having completed a studio flat in Gotham in May 2012. We are asked if we could estimate the price would likely be for a 90 year extension to my lease. Comparable residencies in Gotham with a long lease were in the region of £225,400. The average ground rent payable was £45 billed every twelve months. The lease expiry date was in 2090. Having 64 years as a residual term we approximated the premium to the landlord for the lease extension to be between £16,200 and £18,600 not including fees.
In 2011 we were called by Mr and Mrs. Y David who, having was assigned a lease of a garden apartment in Gotham in April 2002. The dilemma was if we could approximate the compensation to the landlord would likely be to extend the lease by 90 years. Comparative flats in Gotham with 100 year plus lease were in the region of £270,000. The mid-range amount of ground rent was £55 billed every twelve months. The lease expiry date was on 23 January 2101. Having 75 years left we calculated the compensation to the freeholder for the lease extension to be within £9,500 and £11,000 exclusive of fees.