There is no doubt about it a leasehold flat or house in Kineton is a wasting asset as a result of the shortening lease. Where the lease has, beyond 125 years remaining then this decrease may be of little impact that being said there will become a stage when a lease has under than eighty years left as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the primary logic behind why you should consider extending without delay. Most flat owners in Kineton will meet the qualifying criteria; however a lawyer should be able to confirm if you are eligible for a lease extension. In limited situations you may not qualify, the most common reason being that you have owned the property for under two years.
It is conventional wisdom that a residential leasehold with over one hundred years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| 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; |
| 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. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service will provide you increased control over the value of your Kineton leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Oscar was the the leasehold owner of a high value apartment in Kineton being sold with a lease of a few days over 59 years remaining. Oscar informally approached his landlord being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years on the basis of an increased rent to £125 yearly. No ground rent would be payable on a lease extension were Oscar to exercise his statutory right. Oscar obtained expert advice and was able to make a more informed decision and deal with the matter and readily saleable.
In 2012 we were phoned by Dr Edward James who, having owned a one bedroom flat in Kineton in March 2012. The dilemma was if we could shed any light on how much (roughly) premium would likely be to prolong the lease by ninety years. Comparative residencies in Kineton with 100 year plus lease were in the region of £245,000. The average amount of ground rent was £50 billed quarterly. The lease terminated in 2093. Taking into account 68 years outstanding we estimated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 not including costs.
In 2010 we were approached by Mr and Mrs. N Rogers who, having took over the lease of a ground floor apartment in Kineton in October 2005. We are asked if we could approximate the price would likely be to extend the lease by an additional years. Identical flats in Kineton with a long lease were worth £285,000. The mid-range ground rent payable was £55 invoiced every twelve months. The lease expired on 2 June 2104. Considering the 79 years as a residual term we approximated the premium to the landlord for the lease extension to be within £13,300 and £15,400 plus fees.