Unfortunately that a Mapperley residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the Mapperley property prices.Once your lease gets to 85ish years, you need to start considering a lease extension. If the number of years remaining slips below 80 years, you will end up paying 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property The majority of flat owners in Mapperley will be able to extend under the legislation; however a lawyer should be able to confirm if 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 conveyancing solicitor throughout the formalities.
It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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 also be not less than 75 years at the outset of the mortgage. |
| 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 freeholder in Mapperley,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Mapperley valuers.
During the course of the last few months Ibrahim, started to get close to the 80-year threshold with the lease on his garden flat in Mapperley. Having bought his property two decades ago, the lease term was of little interest. Luckily, he recognised he needed to take steps soon on a lease extension. Ibrahim arranged for a lease extension at the eleventh hour last March. Ibrahim and the freeholder eventually agreed on sum of £5,500 . If he had missed the deadline, the price would have increased by at least £900.
Last month we were approach by Dr Rebecca Hernández , who bought a basement flat in Mapperley in June 1996. The question was if we could estimate the premium would be for a 90 year lease extension. Comparable properties in Mapperley with a long lease were in the region of £254,200. The mid-range ground rent payable was £60 billed monthly. The lease ran out on 14 April 2076. Taking into account 51 years remaining we estimated the premium to the landlord to extend the lease to be within £43,700 and £50,600 exclusive of expenses.
Last Summer we were contacted by Dr C James , who owned a first floor apartment in Mapperley in June 1999. The dilemma was if we could approximate the premium would likely be to prolong the lease by a further 90 years. Comparative residencies in Mapperley with 100 year plus lease were worth £210,600. The mid-range amount of ground rent was £45 invoiced every twelve months. The lease lapsed on 9 September 2087. Given that there were 62 years left we estimated the compensation to the freeholder to extend the lease to be between £18,100 and £20,800 plus professional charges.