Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will normally be granted for a prescribed period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Kirkstall. Clearly, the term of lease remaining shortens over time. This is often overlooked and only raises itself as an issue when the residence has to be disposed of or re-mortgaged. The fewer the years remaining the less it is worth and the more it will cost to procure a lease extension. Eligible long lease owners in Kirkstall have the right to extend the lease for an additional 90 years in accordance with legislation. Please give due deliberation before putting off your Kirkstall lease extension. Holding off that expense now only increases the price you will eventually incur for a lease extension
Leasehold properties in Kirkstall with over 100 years remaining on the lease are often regarded as a ‘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 service charges warrant 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 Kirkstall,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Kirkstall valuers.
Sam was the the leasehold owner of a high value flat in Kirkstall being sold with a lease of a little over fifty eight years left. Sam informally contacted his freeholder being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £100 per annum. No ground rent would be due on a lease extension were Sam to invoke his statutory right. Sam procured expert legal guidance and secured an acceptable resolution informally and sell the flat.
Mr and Mrs. J Pérez acquired a basement flat in Kirkstall in November 2001. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be for a ninety year extension to my lease. Similar residencies in Kirkstall with an extended lease were worth £246,800. The average ground rent payable was £60 billed every twelve months. The lease ran out on 3 April 2076. Having 50 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £44,700 and £51,600 not including legals.
In 2014 we were contacted by Mrs R Scott who, having purchased a studio apartment in Kirkstall in March 2001. The question was if we could estimate the premium would be for a 90 year lease extension. Similar premises in Kirkstall with a long lease were worth £208,200. The average ground rent payable was £65 invoiced annually. The lease end date was in 2087. Considering the 61 years unexpired we estimated the compensation to the landlord for the lease extension to be within £20,000 and £23,000 exclusive of expenses.