With a domestic leasehold property in Hurworth, you are actually buying a right to live in a property for a prescribed time frame. In recent years flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you should think about a lease extension sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease gets disproportionately more expensive particularly when there are fewer than eighty years remaining. Leasehold owners in Hurworth with a lease approaching 81 years remaining should seriously consider extending it as soon as possible. When the lease term has under eighty years outstanding, under the relevant Act the freeholder can calculate and charge a larger amount, based on a technical computation, strangely termed as “marriage value” which is due.
It is conventional wisdom that a property with over one hundred years remaining is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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 conveyancers that we work with handle Hurworth 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 Winter Ibrahim, started to get near to the eighty-year threshold with the lease on his one bedroom apartment in Hurworth. In buying his flat two decades ago, the lease term was of minimal importance. Thankfully, he recognised he needed to take action soon on a lease extension. Ibrahim arranged for a lease extension at the eleventh hour in June. Ibrahim and the freeholder in the end agreed on the final figure of £5,500 . If he failed to meet the deadline, the amount would have gone up by a minimum £1,000.
Mrs Stephanie Martinez completed a studio flat in Hurworth in May 2006. We are asked if we could shed any light on how much (roughly) premium would likely be to prolong the lease by ninety years. Comparable homes in Hurworth with a long lease were in the region of £264,000. The average amount of ground rent was £60 collected annually. The lease lapsed in 2078. Given that there were 53 years as a residual term we approximated the compensation to the landlord for the lease extension to be within £37,100 and £42,800 exclusive of fees.
Dr Theo Wright completed a first floor flat in Hurworth in July 2010. We are asked if we could estimate the compensation to the landlord would likely be to prolong the lease by ninety years. Comparable premises in Hurworth with 100 year plus lease were in the region of £225,400. The mid-range amount of ground rent was £45 invoiced annually. The lease expired in 2089. Considering the 64 years as a residual term we calculated the compensation to the freeholder to extend the lease to be within £15,200 and £17,600 plus fees.