Kingswood leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease gets more expensive. Legislation has been in place for sometime now which permits qualifying Kingswood residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Kingswood you really ought to see if your lease has between 70 and ninety years remaining. There are compelling reasons why a Kingswood leaseholder with a lease having around 80 years unexpired should take action to ensure that a lease extension is effected without delay
It is conventional wisdom that a property with more than one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
Regardless of whether you are a tenant or a freeholder in Kingswood,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Kingswood valuers.
In recent months Callum, came perilously near to the eighty-year threshold with the lease on his one bedroom apartment in Kingswood. In buying his flat 19 years previously, the lease term was of no relevance. As luck would have it, he recognised he needed to take action soon on a lease extension. Callum was able to extend his lease just under the wire last May. Callum and the freeholder via the managing agents eventually settled on sum of £6,000 . If he not met the deadline, the figure would have increased by at least £1,025.
Last Winter we were phoned by Mr Jason Parker , who moved into a one bedroom flat in Kingswood in January 2003. We are asked if we could approximate the premium could be for a 90 year extension to my lease. Comparative flats in Kingswood with a long lease were valued around £290,000. The mid-range amount of ground rent was £45 invoiced annually. The lease ended in 2099. Given that there were 73 years left we approximated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 not including professional charges.
Mr and Mrs. O Young took over the lease of a basement flat in Kingswood in April 2006. We are asked if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Comparable residencies in Kingswood with a long lease were valued about £235,600. The average amount of ground rent was £60 collected yearly. The lease ran out in 2088. Given that there were 62 years unexpired we estimated the compensation to the freeholder for the lease extension to be between £21,900 and £25,200 plus costs.