As the the remaining lease term of a Halesowen domestic lease diminished so does its value and therefore the value of your property. If the residual term has, in excess of one hundred years to run then this decrease may be negligible however there will become a stage when a lease has under than 80 years remaining as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the main rational as to why you should consider extending sooner rather than later. The majority of flat owners in Halesowen will meet the qualifying criteria; that being said a lawyer can confirm if you are eligible to extend your lease. In certain situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold properties in Halesowen with in excess of 100 years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges warrant 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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 |
The lawyers that we work with procure Halesowen 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.
Last year Finn, started to get close to the eighty-year threshold with the lease on his purpose- built apartment in Halesowen. In buying his property 18 years previously, the length of the lease was of little interest. As luck would have it, it dawned on him that he would imminently be paying an escalated premium for Extending the lease. Finn extended the lease just ahead of time in April. Finn and the freeholder via the management company ultimately settled on a premium of £5,000 . If he failed to meet the deadline, the premium would have escalated by at least £1,050.
Last July we were phoned by Mr Jamie François , who was assigned a lease of a ground floor apartment in Halesowen in April 1999. We are asked if we could estimate the price could be for a 90 year lease extension. Comparable flats in Halesowen with an extended lease were worth £264,000. The mid-range amount of ground rent was £60 billed per annum. The lease expired on 26 July 2079. Given that there were 53 years outstanding we calculated the premium to the freeholder for the lease extension to be between £37,100 and £42,800 plus expenses.
In 2012 we were e-mailed by Dr R Ward who, having moved into a one bedroom apartment in Halesowen in May 1995. The question was if we could estimate the premium would likely be to extend the lease by ninety years. Comparative properties in Halesowen with a long lease were in the region of £218,000. The average amount of ground rent was £45 invoiced quarterly. The lease expired in 2089. Given that there were 63 years remaining we estimated the compensation to the landlord for the lease extension to be between £17,100 and £19,800 exclusive of fees.