Unfortunately that a Malmesbury residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the deflation being disguised by increases in the Malmesbury 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 under eighty years - otherwise a higher premium will be payable. The majority of leasehold owners in Malmesbury will be able to extend under the legislation; however a conveyancer will be able to clarify whether you qualify for an extension. In some situations you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancer for the duration of the formalities.
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 premises will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| Coventry Building Society | 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with handle Malmesbury lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancer we work with provide it.
Off the back of lengthy negotiations with the landlord of her studio flat in Malmesbury, Melissa started the lease extension process just as her lease was approaching the all-important eighty-year deadline. The lease extension was finalised in August 2012. The landlord’s costs were kept to an absolute minimum.
In 2014 we were contacted by Mr and Mrs. N Bennett who, having completed a ground floor flat in Malmesbury in September 2004. We are asked if we could shed any light on how much (roughly) price would be for a ninety year lease extension. Identical flats in Malmesbury with 100 year plus lease were worth £270,000. The mid-range ground rent payable was £55 collected per annum. The lease finished in 2099. Taking into account 74 years unexpired we estimated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 plus fees.
Mr and Mrs. T Moreau completed a one bedroom flat in Malmesbury in March 2007. We are asked if we could approximate the premium would likely be for a ninety year lease extension. Identical premises in Malmesbury with an extended lease were worth £166,400. The average ground rent payable was £60 collected per annum. The lease expired in 2079. Considering the 54 years outstanding we estimated the compensation to the freeholder to extend the lease to be between £32,300 and £37,400 plus expenses.