Irby leases on domestic properties are gradually losing value. Where your lease has approximately ninety years unexpired, you should start considering the need for a lease extension. Eighty years is a significant number: when the remaining term of a lease dips below this level then you begin incurring an additional element called marriage value. Flat owners in Irby will usually be legally entitled to a lease extension; however It would be wise to check with a lawyer to confirm if you qualify. In some cases you may not be entitled. There are prescribed deadlines and steps to follow once the process is triggered so it’s prudent to be guided by a conveyancer during the process.
It is generally accepted that a residential leasehold with more than 100 years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 30 years left, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Irby,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Irby valuers.
Last October Andrew, came precariously close to the 80-year mark with the lease on his basement apartment in Irby. In buying his flat two decades ago, the lease term was of no significance. Luckily, he recognised he needed to take steps soon on Extending the lease. Andrew was able to extend his lease just under the wire in March. Andrew and the landlord eventually settled on sum of £5,500 . If he failed to meet the deadline, the premium would have gone up by a minimum £850.
Mr Ben Pérez bought a one bedroom flat in Irby in October 2009. We are asked if we could approximate the compensation to the landlord would likely be for a 90 year extension to my lease. Comparative premises in Irby with 100 year plus lease were in the region of £225,800. The mid-range ground rent payable was £60 invoiced per annum. The lease terminated on 26 August 2085. Given that there were 60 years as a residual term we estimated the compensation to the freeholder to extend the lease to be within £25,700 and £29,600 not including expenses.
Ms O Jackson acquired a newly refurbished apartment in Irby in November 1999. The question was if we could shed any light on how much (roughly) price could be for a 90 year lease extension. Comparable properties in Irby with 100 year plus lease were worth £210,000. The mid-range ground rent payable was £50 collected annually. The lease end date was in 2105. Considering the 80 years left we calculated the premium to the landlord to extend the lease to be between £8,600 and £9,800 not including legals.