The re-sale value of a leasehold property in Grays depends on how long the lease has left to run. If it is near to or fewer than 80 years you should anticipate problems on re-sale, so it is advisable to arrange for a lease extension prior to buying. It is preferable to commence the process of extending the lease is when the lease still has 82 years remaining so that all matters can be finalised prior to the 80 year mark. Current legislation enables Grays qualifying lessees to an additional term of 90 years on top of the remaining term, at a notional rent (zero ground rent). The purpose of the valuation is to determine the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold residencies in Grays with in excess of one hundred 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 property. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
The lawyers that we work with handle Grays lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Toby owned a conversion apartment in Grays being marketed with a lease of a little over sixty years unexpired. Toby informally spoke with his freeholder a well known Bristol-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of an increased rent to £100 yearly. No ground rent would be payable on a lease extension were Toby to invoke his statutory right. Toby obtained expert legal guidance and secured an acceptable deal without resorting to tribunal and ending up with a market value flat.
Last month we were e-mailed by Mrs E Lefebvre , who purchased a newly refurbished flat in Grays in November 2006. The dilemma was if we could estimate the price could be for a 90 year extension to my lease. Comparative premises in Grays with an extended lease were valued about £246,800. The average ground rent payable was £60 collected per annum. The lease ended in 2075. Taking into account 50 years left we estimated the premium to the landlord to extend the lease to be within £44,700 and £51,600 plus fees.
An example of a Lease Extension decision for a Grays premises 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 related to 13 flats. The remaining number of years on the lease was 76 years.