It’s an underpublicised truth that a Lunt residential lease is a wasting 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 deflation being disguised by increases in the Lunt property market.Once your lease gets to 85ish years, 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 lower than 80 years - otherwise a higher amount will be due. Most leasehold owners in Lunt will be able to extend under the legislation; however a lawyer will be able to confirm whether you are eligibility. In some situations you may not qualify. There are also strict timeframes and procedures to follow once the process is initiated and you will need to be guided by your lawyer throughout the process.
It is conventional wisdom that a property with over 100 years remaining is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 30 years unexpired, the residence 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 are not acceptable. 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; |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Lease extensions in Lunt can be a difficult process. We recommend you procure professional help from a conveyancing solicitor and valuer with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Lunt lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last Spring Harvey, came very close to the eighty-year threshold with the lease on his first floor apartment in Lunt. Having bought his property two decades ago, the length of the lease was of minimal interest. Thankfully, it dawned on him that he needed to take action soon on a lease extension. Harvey extended the lease at the eleventh hour in August. Harvey and the landlord who owned the flat above eventually agreed on the final figure of £5,000 . If the lease had dipped lower than eighty years, the premium would have escalated by at least £1,150.
Mr and Mrs. N Phillips completed a first floor apartment in Lunt in August 1997. We are asked if we could approximate the premium would be for a ninety year lease extension. Comparable premises in Lunt with 100 year plus lease were valued around £200,800. The average ground rent payable was £65 invoiced quarterly. The lease concluded in 2086. Given that there were 60 years as a residual term we calculated the premium to the freeholder for the lease extension to be within £20,900 and £24,200 plus fees.
In 2009 we were called by Dr Sophia Anderson who, having owned a garden flat in Lunt in May 2010. The dilemma was if we could approximate the price would likely be for a ninety year lease extension. Comparable homes in Lunt with a long lease were worth £255,000. The average ground rent payable was £50 billed yearly. The lease came to a finish in 2097. Having 71 years left we estimated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of professional charges.