The only way is down when it comes to Kings Heath lease terms. Kings Heath flats that have a remaining term lower than eighty years will de-escalate in value at a rapid rate, and the cost of extending your lease will go up.
Leasehold properties in Kings Heath with more than one hundred years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges justify it.
| 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; |
| Chelsea 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
| 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. |
Retaining our service will provide you enhanced control over the value of your Kings Heath leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Charlie owned a studio flat in Kings Heath being sold with a lease of fraction over fifty eight years left. Charlie informally spoke with his landlord 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 a rise in the rent to £50 yearly. Ordinarily, ground rent would not be payable on a lease extension were Charlie to invoke his statutory right. Charlie obtained expert advice and was able to make a more informed decision and deal with the matter and ending up with a market value flat.
Last Spring we were contacted by Dr J Sharif , who was assigned a lease of a studio apartment in Kings Heath in February 2007. We are asked if we could shed any light on how much (roughly) premium could be for a 90 year lease extension. Comparative flats in Kings Heath with a long lease were worth £275,000. The mid-range amount of ground rent was £65 billed every twelve months. The lease ended on 22 October 2093. Given that there were 68 years outstanding we estimated the compensation to the landlord for the lease extension to be between £13,300 and £15,400 not including fees.
Mr and Mrs. L André completed a studio apartment in Kings Heath in November 2010. The dilemma was if we could estimate the compensation to the landlord would likely be to prolong the lease by 90 years. Comparative homes in Kings Heath with an extended lease were in the region of £213,600. The average amount of ground rent was £60 collected annually. The lease ran out on 11 November 2082. Considering the 57 years unexpired we calculated the premium to the freeholder for the lease extension to be within £30,400 and £35,200 plus costs.