It’s a harsh certainty that a Leeswood residential lease is a deteriorating 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 Leeswood property prices.Once your lease nears 85ish years, you should start thinking about a lease extension. If the number of years remaining dips below 80 years, you will end up paying half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property The majority of flat owners in Leeswood will be able to extend under the legislation; however a conveyancer will be able to clarify if you are eligibility. In some situations you may not qualify. There are also strict deadlines and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancer for the duration of the process.
It is conventional wisdom that a residential leasehold with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years ahead.
| 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. |
| Bank of 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
The conveyancing solicitors that we work with handle Leeswood 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.
Subsequent to lengthy correspondence with the landlord of her first floor apartment in Leeswood, Millie started the lease extension process as the 80 year deadline was swiftly nearing. The lease extension was finalised in March 2012. The landlord’s costs were kept to an absolute minimum.
Mr Ben Rose was assigned a lease of a basement flat in Leeswood in November 2011. The dilemma was if we could approximate the premium could be for a 90 year lease extension. Comparable properties in Leeswood with an extended lease were valued around £295,000. The average amount of ground rent was £50 collected monthly. The lease elapsed in 2100. Given that there were 75 years left we calculated the compensation to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of expenses.
Last August we were e-mailed by Mrs Emily Murphy , who completed a ground floor flat in Leeswood in October 2012. We are asked if we could approximate the price would be to prolong the lease by a further 90 years. Similar premises in Leeswood with an extended lease were worth £250,400. The average ground rent payable was £65 billed per annum. The lease came to a finish on 20 April 2089. Considering the 64 years outstanding we calculated the premium to the freeholder for the lease extension to be between £19,000 and £22,000 plus professional charges.