There is no doubt about it a leasehold flat or house in Gunnislake is a wasting asset as a result of the shortening lease. Where the residual term has, over 99 years remaining then this decrease may be fractional that being said there will become a stage when a lease has under than eighty years left as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main rational as to why you should extend the lease sooner rather than later. Most flat owners in Gunnislake will qualify for this right; nevertheless a conveyancing solicitor can confirm if you are eligible for a lease extension. In limited situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
It is generally considered that a residential leasehold with more than 100 years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 35 years unexpired, the property will be worth the same as 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Godiva Mortgages | 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
Using our service will provide you better control over the value of your Gunnislake leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Hugo was the the leasehold proprietor of a 2 bedroom flat in Gunnislake on the market with a lease of a few days over 59 years left. Hugo on an informal basis contacted his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £200 per annum and increase every twenty five years thereafter. No ground rent would be payable on a lease extension were Hugo to exercise his statutory right. Hugo obtained expert legal guidance and secured an acceptable resolution informally and sell the flat.
In 2012 we were e-mailed by Mrs I Norbert who, having bought a garden flat in Gunnislake in April 2003. The dilemma was if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Similar flats in Gunnislake with a long lease were valued around £245,000. The average amount of ground rent was £45 collected per annum. The lease came to a finish on 9 March 2094. Considering the 68 years outstanding we estimated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 plus costs.
In 2010 we were called by Dr Grace Bennett who, having owned a basement apartment in Gunnislake in April 2004. The dilemma was if we could shed any light on how much (roughly) price would likely be to extend the lease by ninety years. Comparable properties in Gunnislake with a long lease were worth £285,000. The mid-range amount of ground rent was £55 invoiced quarterly. The lease expired in 2105. Taking into account 79 years outstanding we calculated the premium to the landlord to extend the lease to be between £13,300 and £15,400 exclusive of professional charges.