Kingsthorpe leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. The majority of owners of residential leasehold property in Kingsthorpe enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Kingsthorpe you really ought to investigate if your lease has between 70 and 90 years remaining. In particular once the remaining lease term slips under 80 years, the cost of any lease extension increases dramatically as an element of the premium you pay is what is known as a marriage value
Leasehold residencies in Kingsthorpe with in excess of 100 years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Engaging our service will provide you enhanced control over the value of your Kingsthorpe leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
During the course of the last few months Sebastian, came precariously close to the 80-year threshold with the lease on his leasehold flat in Kingsthorpe. In buying his property twenty years ago, the length of the lease was of no significance. Thankfully, he recognised he needed to take action soon on Extending the lease. Sebastian arranged for a lease extension at the eleventh hour in July. Sebastian and the landlord eventually settled on an amount of £6,000 . If he failed to meet the deadline, the sum would have escalated by a minimum £1,125.
In 2014 we were contacted by Dr Leo Gray who, having was assigned a lease of a purpose-built flat in Kingsthorpe in August 2009. The dilemma was if we could estimate the premium could be for a ninety year lease extension. Comparable homes in Kingsthorpe with 100 year plus lease were worth £218,000. The mid-range ground rent payable was £45 collected monthly. The lease finished on 7 July 2089. Having 63 years unexpired we calculated the premium to the freeholder to extend the lease to be within £17,100 and £19,800 plus costs.
In 2014 we were called by Dr Eliot Stewart who, having acquired a studio flat in Kingsthorpe in November 2000. The dilemma was if we could estimate the compensation to the landlord could be to prolong the lease by a further 90 years. Comparative homes in Kingsthorpe with an extended lease were worth £265,000. The mid-range amount of ground rent was £50 billed monthly. The lease lapsed on 25 November 2100. Taking into account 74 years left we calculated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 not including costs.