It’s an underpublicised truth that a Lees and Moorside residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Lees and Moorside property prices.Once your lease nears 85ish years, you should start thinking about a lease extension. If the number of years remaining slips under 80 years, you will end up paying 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property Most flat owners in Lees and Moorside will be able to extend under the legislation; however a lawyer will be able to confirm whether you qualify for an extension. In some situations you may not be entitled. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your lawyer from beginning to end of the process.
It is generally accepted that a residential leasehold with more than one hundred years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 30 years unexpired, the property will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Engaging our service gives you better control over the value of your Lees and Moorside leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Nathan was the the leasehold owner of a conversion flat in Lees and Moorside being marketed with a lease of fraction over sixty years left. Nathan informally contacted his landlord being a well known local-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years subject to a rise in the rent to £50 yearly. No ground rent would be due on a lease extension were Nathan to exercise his statutory right. Nathan procured expert advice and secured an acceptable resolution without going to tribunal and ending up with a market value flat.
Dr Thomas Roberts owned a recently refurbished apartment in Lees and Moorside in June 2007. The question was if we could shed any light on how much (approximately) price would likely be to extend the lease by a further 90 years. Similar premises in Lees and Moorside with a long lease were in the region of £264,000. The average amount of ground rent was £60 invoiced per annum. The lease concluded on 14 November 2078. Having 53 years unexpired we estimated the premium to the landlord to extend the lease to be between £37,100 and £42,800 plus costs.
Last year we were phoned by Ms S Norbert , who purchased a one bedroom flat in Lees and Moorside in July 2008. The dilemma was if we could shed any light on how much (roughly) price would likely be to extend the lease by an additional years. Similar flats in Lees and Moorside with a long lease were valued around £225,400. The mid-range amount of ground rent was £45 collected every twelve months. The lease concluded in 2089. Having 64 years left we calculated the compensation to the freeholder for the lease extension to be between £15,200 and £17,600 exclusive of professional charges.