Horbury leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease becomes more expensive. It is the case that most Horbury tenants have the right to extend their lease by an additional 90 years by virtue of the 1993 Leasehold Reform Act. Where you are a leasehold owner in Horbury you should investigate if your lease has between 70 and 90 years remaining. There are compelling reasons why a Horbury flat owner with a lease having around 80 years left should take steps to ensure that a lease extension is effected without delay
It is conventional wisdom that a residential leasehold with more than one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years ahead.
| 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 Horbury 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 Christmas Kyle, started to get close to the 80-year mark with the lease on his purpose- built flat in Horbury. In buying his property two decades ago, the unexpired term was of minimal relevance. Thankfully, he realised he would soon be paying an escalated premium for Extending the lease. Kyle was able to extend his lease at the eleventh hour last March. Kyle and the landlord in the end settled on an amount of £5,000 . If the lease had fallen lower than 80 years, the sum would have escalated by a minimum £1,125.
In 2014 we were phoned by Dr Yasmin Bernard who, having purchased a purpose-built apartment in Horbury in July 2001. We are asked if we could shed any light on how much (roughly) price would likely be for a ninety year lease extension. Identical residencies in Horbury with 100 year plus lease were in the region of £191,400. The average ground rent payable was £55 billed per annum. The lease lapsed in 2080. Taking into account 54 years outstanding we estimated the premium to the landlord to extend the lease to be within £34,200 and £39,600 plus expenses.
Mr and Mrs. P Miller bought a studio flat in Horbury in August 1998. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be to extend the lease by 90 years. Comparative premises in Horbury with an extended lease were in the region of £295,000. The mid-range amount of ground rent was £45 collected every twelve months. The lease finished in 2100. Taking into account 74 years as a residual term we approximated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 exclusive of costs.