For anyone whose Lydiate home is held on a long lease, the message is clear – if you ignore the situation, your property will eventually revert to the freeholder, leaving you empty-handed. The shorter the lease the less it is worth and the more it will cost to extend the lease.
It is generally accepted that a residential leasehold 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 premises will be equivalent in value to 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
Engaging our service gives you better control over the value of your Lydiate leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
16 months ago John, started to get near to the eighty-year mark with the lease on his studio flat in Lydiate. In buying his flat twenty years ago, the lease term was of little concern. Fortunately, he realised he needed to take steps soon on Extending the lease. John extended the lease just in the nick of time last May. John and the landlord who owned the flat above in the end agreed on sum of £5,000 . If the lease had dropped to less than 80 years, the sum would have become more costly by at least £975.
Ms B Lambert was assigned a lease of a first floor apartment in Lydiate in June 1995. We are asked if we could shed any light on how much (roughly) premium could be to prolong the lease by an additional years. Comparative premises in Lydiate with an extended lease were worth £285,000. The mid-range amount of ground rent was £45 collected quarterly. The lease ran out on 13 October 2098. Taking into account 72 years outstanding we calculated the premium to the landlord to extend the lease to be between £12,400 and £14,200 not including legals.
In 2013 we were phoned by Dr T Martin who, having acquired a first floor apartment in Lydiate in April 2011. The dilemma was if we could estimate the price would likely be for a 90 year lease extension. Identical flats in Lydiate with a long lease were worth £233,200. The mid-range amount of ground rent was £60 billed monthly. The lease expired on 17 September 2087. Given that there were 61 years as a residual term we approximated the premium to the landlord to extend the lease to be within £22,800 and £26,400 not including expenses.