It’s a harsh truth that a Hope Valley residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the reduction being disguised by increases in the Hope Valley property market.Once your lease nears 85ish years, you need to start considering a lease extension. If lease term dips below 80 years, you will end up paying half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most leasehold owners in Hope Valley will be able to extend under the legislation; however a lawyer will be able to confirm if you are eligibility. In some cases you may not qualify. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer for the duration of the formalities.
Leasehold residencies in Hope Valley with in excess of 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 conveyancers that we work with handle Hope Valley 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.
Last Spring Stanley, started to get near to the eighty-year mark with the lease on his leasehold flat in Hope Valley. Having purchased his flat two decades ago, the length of the lease was of no importance. Fortunately, he realised he would imminently be paying an inflated amount for Extending the lease. Stanley extended the lease just in the nick of time last March. Stanley and the landlord who owned the flat above in the end agreed on the final figure of £5,500 . If he not met the deadline, the premium would have increased by at least £1,125.
In 2010 we were e-mailed by Ms Hollie Mercier who, having bought a studio flat in Hope Valley in August 1996. We are asked if we could approximate the compensation to the landlord would be for a 90 year extension to my lease. Similar premises in Hope Valley with 100 year plus lease were in the region of £275,000. The average ground rent payable was £65 invoiced monthly. The lease expiry date was in 2093. Having 68 years outstanding we calculated the premium to the landlord to extend the lease to be within £13,300 and £15,400 plus expenses.
In 2014 we were called by Mrs Kirsty Brown who, having completed a garden apartment in Hope Valley in August 1997. We are asked if we could estimate the premium could be to extend the lease by ninety years. Comparative flats in Hope Valley with 100 year plus lease were valued about £208,600. The mid-range ground rent payable was £60 invoiced annually. The lease concluded on 23 June 2082. Having 57 years as a residual term we calculated the compensation to the freeholder to extend the lease to be within £30,400 and £35,200 not including costs.