Maldon 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 the lease gets more expensive. It is the case that most Maldon tenants have the right to extend their lease by an additional ninety years under the 1993 Leasehold Reform Act. Where you are a leasehold owner in Maldon you should investigate if your lease has between 70 and 90 years remaining. There are compelling reasons why a Maldon leaseholder with a lease having around eighty years unexpired should take action to ensure that a lease extension is put in place without delay
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| 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. |
| 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. |
| 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. |
Regardless of whether you are a tenant or a landlord in Maldon,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Maldon valuers.
In recent months Benjamin, started to get close to the eighty-year threshold with the lease on his studio flat in Maldon. In buying his property 19 years previously, the unexpired term was of no concern. As luck would have it, it dawned on him that he would soon be paying an inflated amount for Extending the lease. Benjamin was able to extend his lease just ahead of time in July. Benjamin and the freeholder eventually agreed on the final figure of £5,500 . If the lease had fallen to less than eighty years, the amount would have escalated by a minimum £875.
Dr S Clark purchased a studio flat in Maldon in August 2012. The dilemma was if we could estimate the compensation to the landlord could be for a ninety year lease extension. Comparable premises in Maldon with an extended lease were in the region of £242,600. The mid-range amount of ground rent was £45 billed every twelve months. The lease elapsed on 17 May 2093. Given that there were 67 years outstanding we calculated the premium to the freeholder for the lease extension to be between £11,400 and £13,200 exclusive of professional charges.
In 2010 we were e-mailed by Dr Katie Howard who, having moved into a purpose-built flat in Maldon in October 2008. The dilemma was if we could shed any light on how much (approximately) premium would be for a 90 year extension to my lease. Identical residencies in Maldon with an extended lease were worth £280,000. The average ground rent payable was £55 collected annually. The lease came to a finish on 21 September 2104. Given that there were 78 years remaining we calculated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 plus legals.