Unfortunately that a Lound residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the depreciation being disguised by increases in the Lound property prices.Once your lease nears 85ish years, you need to start considering a lease extension. If lease term slips under eighty 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 additional value that a lease extension will add the property The majority of leasehold owners in Lound will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify if you are eligibility. In some cases you may not be entitled. There are also strict timeframes and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor for the duration of the formalities.
Leasehold premises in Lound with over 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges justify it.
| 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Retaining our service gives you increased control over the value of your Lound leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Felix was the the leasehold proprietor of a studio flat in Lound on the market with a lease of just over 72 years outstanding. Felix informally spoke with his landlord a well known local-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years subject to a rise in the rent to £200 annually. No ground rent would be due on a lease extension were Felix to invoke his statutory right. Felix obtained expert legal guidance and was able to make an informed decision and deal with the matter and readily saleable.
Ms A Allen moved into a one bedroom apartment in Lound in June 2003. We are asked if we could estimate the premium could be for a ninety year lease extension. Similar flats in Lound with a long lease were valued about £260,000. The average ground rent payable was £50 invoiced yearly. The lease expired in 2098. Having 72 years as a residual term we calculated the compensation to the freeholder for the lease extension to be within £9,500 and £11,000 not including costs.
Mr and Mrs. R Baker owned a purpose-built apartment in Lound in August 2004. We are asked if we could estimate the price could be to prolong the lease by ninety years. Comparable homes in Lound with an extended lease were valued around £256,600. The average amount of ground rent was £60 billed quarterly. The lease expiry date was in 2078. Taking into account 52 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £41,800 and £48,400 not including expenses.