Halesworth leases on residential properties are gradually losing value. Where your lease has about ninety years left, you should start thinking about a lease extension. If lease term falls under 80 years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Leasehold owners in Halesworth will mostly qualify for a lease extension; however a solicitor should be able confirm your eligibility. In certain cases you may not qualify. There are prescribed deadlines and formalities to comply with once the process has started so it’s best to be guided by a conveyancing solicitor during the process.
It is conventional wisdom that a residential leasehold with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| 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. |
| 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 |
| 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 Halesworth 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 conveyancer we work with provide it.
14 months ago Isaac, started to get close to the eighty-year threshold with the lease on his studio flat in Halesworth. In buying his home twenty years previously, the unexpired term was of no importance. As luck would have it, he realised he needed to take steps soon on Extending the lease. Isaac was able to extend his lease just ahead of time in September. Isaac and the freeholder eventually agreed on sum of £5,000 . If the lease had fallen lower than 80 years, the premium would have escalated by at least £1,100.
In 2014 we were called by Mr and Mrs. C Green who, having owned a garden apartment in Halesworth in October 2005. The question was if we could estimate the price would likely be to prolong the lease by ninety years. Comparative flats in Halesworth with a long lease were in the region of £260,200. The average amount of ground rent was £65 invoiced quarterly. The lease ended on 9 July 2092. Considering the 66 years left we approximated the compensation to the freeholder for the lease extension to be between £15,200 and £17,600 not including expenses.
Dr Caitlin Gunderson was assigned a lease of a first floor flat in Halesworth in March 2010. We are asked if we could estimate the price would likely be to extend the lease by a further 90 years. Similar flats in Halesworth with an extended lease were in the region of £198,800. The mid-range ground rent payable was £55 invoiced per annum. The lease came to a finish in 2081. Given that there were 55 years left we calculated the compensation to the freeholder to extend the lease to be within £33,300 and £38,400 not including costs.