It’s a harsh certainty that a Lanchester residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Lanchester property market.Where your lease has approximately 90 years left, you should 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 80 years - otherwise a higher amount will be due. Most flat owners in Lanchester will be able to extend under the legislation; however a lawyer should be able to confirm if you are eligibility. In some cases you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 45 years unexpired, the property will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Yorkshire 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. |
Using our service gives you increased control over the value of your Lanchester leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Reuben was the the leasehold owner of a conversion flat in Lanchester being sold with a lease of a little over 59 years outstanding. Reuben on an informal basis contacted his landlord a well known Bristol-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent at the outset set at £200 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Reuben to exercise his statutory right. Reuben procured expert legal guidance and secured an acceptable resolution informally and readily saleable.
Dr T Petit was assigned a lease of a ground floor apartment in Lanchester in April 1995. We are asked if we could shed any light on how much (approximately) price would be to prolong the lease by 90 years. Similar flats in Lanchester with an extended lease were worth £173,800. The average amount of ground rent was £60 billed every twelve months. The lease expiry date was on 8 August 2080. Given that there were 55 years left we approximated the compensation to the freeholder for the lease extension to be between £31,400 and £36,200 exclusive of expenses.
Dr Kai Laurent acquired a one bedroom flat in Lanchester in November 2001. We are asked if we could estimate the price could be to extend the lease by ninety years. Comparable properties in Lanchester with an extended lease were valued about £235,200. The average amount of ground rent was £45 collected quarterly. The lease expired in 2091. Having 66 years remaining we approximated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 exclusive of expenses.