When it comes to residential leasehold property in Heaton and Jesmond, you effectively rent it for a certain amount of time. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you should think about a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease gets disproportionately more expensive notably when there are fewer than 80 years left. Leasehold owners in Heaton and Jesmond with a lease approaching 81 years remaining should seriously consider extending it sooner rather than later. Once the lease term has below 80 years outstanding, under the current statute the landlord can calculate and charge a greater amount, assessed on a technical computation, known as “marriage value” which is payable.
Leasehold residencies in Heaton and Jesmond with more than one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
Retaining our service gives you increased control over the value of your Heaton and Jesmond leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
During the course of the last few months Joshua, started to get near to the 80-year threshold with the lease on his ground floor apartment in Heaton and Jesmond. Having purchased his property two decades ago, the unexpired term was of minimal interest. Fortunately, it dawned on him that he would imminently be paying an inflated amount for a lease extension. Joshua was able to extend his lease just ahead of time in March. Joshua and the landlord eventually settled on a premium of £5,500 . If he not met the deadline, the price would have increased by at least £1,050.
Ms M Allen completed a first floor flat in Heaton and Jesmond in October 1996. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord would likely be to extend the lease by a further 90 years. Comparable properties in Heaton and Jesmond with an extended lease were worth £200,000. The average ground rent payable was £50 invoiced monthly. The lease came to a finish on 4 January 2102. Taking into account 77 years as a residual term we estimated the premium to the landlord for the lease extension to be within £8,600 and £9,800 not including professional charges.
Last Autumn we were e-mailed by Mr Jason Smith , who took over the lease of a first floor apartment in Heaton and Jesmond in June 2005. The dilemma was if we could estimate the premium could be to extend the lease by a further 90 years. Similar properties in Heaton and Jesmond with a long lease were in the region of £260,200. The average ground rent payable was £65 billed every twelve months. The lease came to a finish on 23 October 2091. Considering the 66 years left we estimated the compensation to the landlord to extend the lease to be within £16,200 and £18,600 exclusive of costs.