It’s an underpublicised truth that a Mapperley residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the reduction being disguised by increases in the Mapperley property market.Where your lease has approximately 90 years left, you need to 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 slips under eighty years - otherwise a higher premium will be due. Most leasehold owners in Mapperley will be able to extend under the legislation; however a lawyer will be able to confirm whether you qualify for an extension. In some situations you may not qualify. There are also strict timetables and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancer throughout the formalities.
It is conventional wisdom that a property with more than one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 35 years left, the property will be worth the same as a freehold for many years in the future.
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Engaging our service gives you enhanced control over the value of your Mapperley 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 wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Half a year ago Charlie, started to get near to the eighty-year mark with the lease on his studio apartment in Mapperley. Having bought his flat twenty years ago, the unexpired term was of minimal significance. Fortunately, he recognised he needed to take steps soon on a lease extension. Charlie was able to extend his lease just under the wire in March. Charlie and the landlord who owned the flat above in the end agreed on a premium of £6,000 . If the lease had dropped below eighty years, the premium would have gone up by a minimum £1,075.
In 2009 we were e-mailed by Mr W Nelson who, having purchased a studio flat in Mapperley in November 1998. The dilemma was if we could approximate the premium would be for a ninety year lease extension. Comparative premises in Mapperley with 100 year plus lease were in the region of £270,000. The average ground rent payable was £55 invoiced yearly. The lease ran out in 2100. Given that there were 75 years outstanding we estimated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of costs.
In 2014 we were e-mailed by Mrs J Roux who, having owned a garden apartment in Mapperley in November 1995. We are asked if we could approximate the premium could be to prolong the lease by 90 years. Identical premises in Mapperley with 100 year plus lease were in the region of £173,800. The average ground rent payable was £60 invoiced yearly. The lease expired on 23 October 2080. Having 55 years remaining we estimated the premium to the landlord for the lease extension to be within £31,400 and £36,200 exclusive of fees.