Lickey End leases on domestic deteriorating in value. Where your lease has about ninety years unexpired, you should start considering the need for a lease extension. If lease term dips under 80 years, you will then have to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to your landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Leasehold owners in Lickey End will usually qualify for a lease extension; however it’s a good idea to check with a conveyancing solicitor to confirm your eligibility. In certain circumstances you may not be entitled. There are also strict timetables and steps to follow once the process is triggered so it’s wise to be guided by a conveyancing solicitor during the process.
It is generally considered that a residential leasehold with in excess of one hundred 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 remaining, the property will be worth the same as a freehold for many years in the future.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Godiva Mortgages | 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. |
| 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 |
Retaining our service gives you enhanced control over the value of your Lickey End leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Milo was the the leasehold proprietor of a high value apartment in Lickey End being marketed with a lease of a few days over 72 years unexpired. Milo informally spoke with his landlord being a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £100 yearly. No ground rent would be due on a lease extension were Milo to exercise his statutory right. Milo obtained expert legal guidance and was able to make a more informed decision and handle with the matter and readily saleable.
Dr U Parker took over the lease of a basement apartment in Lickey End in November 2007. The question was if we could shed any light on how much (approximately) premium could be to prolong the lease by 90 years. Identical flats in Lickey End with a long lease were worth £257,800. The average ground rent payable was £65 collected monthly. The lease terminated on 24 January 2091. Taking into account 65 years left we approximated the compensation to the freeholder for the lease extension to be between £17,100 and £19,800 not including fees.
Last month we were e-mailed by Ms M Watson , who bought a basement flat in Lickey End in August 2006. We are asked if we could estimate the compensation to the landlord would likely be to prolong the lease by 90 years. Comparable residencies in Lickey End with a long lease were worth £191,400. The average ground rent payable was £55 billed per annum. The lease termination date was in 2080. Taking into account 54 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £34,200 and £39,600 not including professional charges.