Lytham St Annes leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. It is the case that most Lytham St Annes tenants have the right to extend their lease by an additional 90 years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in Lytham St Annes you must see if your lease has between seventy and ninety years remaining. In particular once the remaining lease term slips under 80 years, the cost of any lease extension increases dramatically as part of the premium you will incur is what is known as a marriage value
Leasehold properties in Lytham St Annes with over 100 years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and service charges warrant 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. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a landlord in Lytham St Annes,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Lytham St Annes valuers.
After lengthy discussions with the freeholder of her studio flat in Lytham St Annes, Kelsey commenced the lease extension process as the eighty year threshold was quickly coming. The lease extension was finalised in April 2010. The freeholder’s fees were negotiated to about 700 pounds.
In 2011 we were contacted by Mr V Garcia who, having acquired a ground floor flat in Lytham St Annes in May 1996. The dilemma was if we could estimate the premium would be to prolong the lease by an additional years. Comparable premises in Lytham St Annes with 100 year plus lease were in the region of £254,200. The average ground rent payable was £60 collected per annum. The lease expiry date was on 26 May 2077. Having 51 years left we calculated the compensation to the freeholder to extend the lease to be within £43,700 and £50,600 not including legals.
Mrs Paige Moore owned a first floor flat in Lytham St Annes in October 2010. We are asked if we could approximate the premium could be for a ninety year extension to my lease. Comparative flats in Lytham St Annes with 100 year plus lease were worth £210,600. The average ground rent payable was £45 invoiced quarterly. The lease terminated on 27 February 2088. Given that there were 62 years outstanding we estimated the compensation to the freeholder to extend the lease to be between £18,100 and £20,800 not including professional charges.