It’s a harsh certainty that a Longford residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the depreciation being disguised by increases in the Longford property prices.Where your lease has approximately ninety years left, you should start thinking about 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 dips below 80 years - otherwise a higher amount will be payable. Most flat owners in Longford will be able to extend under the legislation; however a conveyancer should be able to clarify if you are eligibility. In some situations you may not qualify. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancer throughout the process.
It is generally considered that a property with in excess of 100 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 in the future.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Engaging our service gives you better control over the value of your Longford leasehold, as your property will be more valuable and marketable in respect 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.
In recent months Ollie, started to get near to the eighty-year threshold with the lease on his garden apartment in Longford. Having purchased his property two decades ago, the lease term was of little bearing. Luckily, he realised he would soon be paying an inflated amount for Extending the lease. Ollie arranged for a lease extension just under the wire in August. Ollie and the freeholder ultimately agreed on the final figure of £5,000 . If he had missed the deadline, the premium would have become more exhorbitant by at least £1,075.
In 2013 we were approached by Mr M Rogers who, having moved into a garden apartment in Longford in August 2012. The question was if we could approximate the compensation to the landlord could be to extend the lease by a further 90 years. Comparable homes in Longford with a long lease were valued about £191,000. The average ground rent payable was £65 billed quarterly. The lease came to a finish on 20 February 2083. Given that there were 58 years unexpired we calculated the premium to the freeholder for the lease extension to be within £23,800 and £27,400 not including costs.
An example of a Freehold Enfranchisement decision for a Longford premises is 164 Nestles Avenue in October 2013. The tribunal agreed with the proposed price of £20,158 for the freehold and determined that that sum is the amount to be paid into court This case was in relation to 2 flats. The unexpired term was 69 years.