The only way is down when it comes to Grays lease terms. Grays flats that have a lease term lower than 80 years will drop in value at a rapid rate, and the cost to extend your lease will go up.
It is generally accepted that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years ahead.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Irrespective of whether you are a tenant or a freeholder in Grays,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 experience and the close ties they enjoy with Grays valuers.
Andrew was the the leasehold owner of a high value flat in Grays being sold with a lease of a little over sixty years left. Andrew on an informal basis contacted his landlord being a well known London-based freehold company for a lease extension. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £50 yearly. No ground rent would be payable on a lease extension were Andrew to invoke his statutory right. Andrew procured expert legal guidance and was able to make a more informed decision and deal with the matter and ending up with a market value flat.
Dr N Stewart bought a ground floor flat in Grays in June 2006. The dilemma was if we could estimate the premium could be for a ninety year extension to my lease. Similar premises in Grays with 100 year plus lease were worth £166,400. The average amount of ground rent was £60 invoiced per annum. The lease ended on 8 March 2080. Taking into account 54 years unexpired we calculated the compensation to the freeholder for the lease extension to be within £32,300 and £37,400 exclusive of legals.
An example of a Lease Extension matter before the tribunal for a Grays property is Various @ Colombus Square in January 2012. the Tribunal calculated the premiums to be paid for new leases for each of the flats in Mariners Walk to be £3822 and the premium to be paid for the new lease of 2 Knights Court to be £4439. This case was in relation to 13 flats. The unexpired lease term was 76 years.