With a long leasehold property in Kingsley, you are actually buying a right to live in a property for a prescribed time frame. These days flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you may consider a lease extension sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease gets disproportionately more expensive notably when there are fewer than eighty years left. Leasehold owners in Kingsley with a lease approaching 81 years unexpired should seriously think of extending it sooner as opposed to later. Once a lease has under eighty years remaining, under the current Act the freeholder can calculate and levy a larger amount, assessed on a technical computation, strangely termed as “marriage value” which is payable.
Leasehold residencies in Kingsley with in excess of 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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 |
The lawyers that we work with procure Kingsley 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 October Ryan, came perilously near to the 80-year mark with the lease on his first floor flat in Kingsley. In buying his flat two decades ago, the length of the lease was of no relevance. Luckily, he became aware that he needed to take action soon on a lease extension. Ryan arranged for a lease extension just under the wire in July. Ryan and the landlord subsequently agreed on an amount of £5,500 . If he had missed the deadline, the amount would have become more costly by a minimum £1,000.
In 2014 we were contacted by Dr Mia Thompson who, having purchased a ground floor apartment in Kingsley in September 2005. The dilemma was if we could approximate the compensation to the landlord would be to prolong the lease by a further 90 years. Similar homes in Kingsley with a long lease were worth £201,200. The average amount of ground rent was £55 collected per annum. The lease ended in 2081. Taking into account 56 years unexpired we calculated the premium to the landlord for the lease extension to be between £31,400 and £36,200 not including fees.
In 2011 we were contacted by Ms U Adams who, having acquired a one bedroom apartment in Kingsley in September 2008. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be for a ninety year extension to my lease. Identical homes in Kingsley with a long lease were worth £300,000. The mid-range ground rent payable was £50 billed monthly. The lease concluded on 7 May 2101. Taking into account 76 years left we estimated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 not including legals.