Unfortunately that a Kirkby in Ashfield residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the first few years due to the reduction being disguised by increases in the Kirkby in Ashfield property market.Where your lease has approximately ninety years left, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls below eighty years - otherwise a higher premium will be payable. The majority of flat owners in Kirkby in Ashfield will be able to extend under the legislation; however a conveyancer should be able to confirm whether you qualify for an extension. In some cases you may not be entitled. There are also strict timeframes and procedures to follow once the process is instigated and you will need to be guided by your conveyancer for the duration of the process.
It is generally considered that a property with more than one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
The lawyers that we work with handle Kirkby in Ashfield 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 conveyancer we work with provide it.
John was the the leasehold proprietor of a high value flat in Kirkby in Ashfield being sold with a lease of a little over 72 years remaining. John informally contacted his landlord a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent to start with set at £100 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were John to exercise his statutory right. John obtained expert advice and was able to make a more informed judgement and handle with the matter and ending up with a market value flat.
In 2013 we were e-mailed by Dr C Khan who, having bought a studio flat in Kirkby in Ashfield in August 2004. The question was if we could estimate the price could be to extend the lease by an additional years. Similar properties in Kirkby in Ashfield with a long lease were worth £256,600. The mid-range ground rent payable was £60 collected yearly. The lease ran out in 2077. Taking into account 52 years as a residual term we calculated the premium to the freeholder to extend the lease to be within £41,800 and £48,400 exclusive of fees.
Mr and Mrs. B Anderson owned a one bedroom apartment in Kirkby in Ashfield in October 1995. We are asked if we could estimate the price would be for a ninety year extension to my lease. Similar homes in Kirkby in Ashfield with an extended lease were in the region of £218,000. The average amount of ground rent was £45 collected every twelve months. The lease expired on 2 November 2088. Having 63 years unexpired we calculated the premium to the landlord for the lease extension to be between £17,100 and £19,800 exclusive of fees.