With a long leasehold premises in Knowle, you are actually buying an entitlement to reside in a property for a set period of time. These days flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you may consider extending the lease sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease gets disproportionately greater notably when there are less than 80 years left. Residents in Knowle with a lease nearing 81 years remaining should seriously think of extending it as soon as possible. Once a lease has fewer than 80 years remaining, under the current statute the freeholder can calculate and levy a greater amount, based on a technical multiplication, strangely termed as “marriage value” which is due.
Leasehold residencies in Knowle with in excess of one hundred years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges merit 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with handle Knowle 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.
Last Winter Jason, came critically close to the eighty-year threshold with the lease on his one bedroom flat in Knowle. Having purchased his property two decades ago, the lease term was of little significance. Thankfully, he realised he would imminently be paying an escalated premium for a lease extension. Jason extended the lease at the eleventh hour in April. Jason and the landlord who owned the flat above ultimately settled on a premium of £5,000 . If he not met the deadline, the premium would have gone up by a minimum £1,000.
Last November we were approach by Mrs D Mercier , who moved into a purpose-built apartment in Knowle in July 1996. We are asked if we could approximate the price could be to extend the lease by 90 years. Identical residencies in Knowle with 100 year plus lease were worth £168,800. The mid-range ground rent payable was £60 collected monthly. The lease expired in 2081. Given that there were 55 years left we estimated the compensation to the freeholder to extend the lease to be between £31,400 and £36,200 not including fees.
Mr F Lefebvre purchased a ground floor apartment in Knowle in June 1996. The question was if we could approximate the premium would likely be for a ninety year lease extension. Comparable homes in Knowle with an extended lease were worth £235,200. The mid-range ground rent payable was £45 billed monthly. The lease ran out in 2092. Having 66 years as a residual term we calculated the premium to the landlord for the lease extension to be within £12,400 and £14,200 plus professional charges.