Unfortunately that a Irchester residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Irchester property prices.Once your lease gets to 85ish years, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips below eighty years - otherwise a higher premium will be payable. Most flat owners in Irchester will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify whether you qualify for an extension. In some situations you may not be entitled. There are also strict timeframes and procedures to follow once the process is instigated and you will need to be guided by your lawyer throughout the formalities.
It is generally considered that a residential leasehold with more than one hundred years remaining is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 45 years remaining, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with procure Irchester 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 conveyancing solicitor we work with provide it.
In 2014 Cameron, started to get near to the eighty-year mark with the lease on his two bedroom apartment in Irchester. In buying his property two decades ago, the unexpired term was of minimal importance. Thankfully, he became aware that he would soon be paying way over the odds for a lease extension. Cameron was able to extend his lease just under the wire last July. Cameron and the freeholder ultimately agreed on a premium of £6,000 . If he had missed the deadline, the price would have increased by at least £925.
Last Christmas we were approach by Mr and Mrs. P Morris , who was assigned a lease of a one bedroom apartment in Irchester in January 1997. We are asked if we could approximate the price would be for a ninety year lease extension. Identical properties in Irchester with 100 year plus lease were valued about £285,000. The mid-range ground rent payable was £45 collected quarterly. The lease lapsed in 2096. Given that there were 71 years left we calculated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 exclusive of fees.
Last Autumn we were called by Mr Daniel Petit , who moved into a studio apartment in Irchester in June 2007. We are asked if we could shed any light on how much (approximately) compensation to the landlord could be to prolong the lease by 90 years. Similar properties in Irchester with an extended lease were worth £225,800. The average ground rent payable was £60 billed monthly. The lease ended on 24 March 2085. Given that there were 60 years outstanding we approximated the premium to the freeholder for the lease extension to be within £25,700 and £29,600 plus costs.