It’s an underpublicised truth that a Market Harborough 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 deflation being disguised by increases in the Market Harborough property market.Where your lease has approximately 90 years left, you should start considering 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 below 80 years - otherwise a higher premium will be due. The majority of flat owners in Market Harborough will be able to extend under the legislation; however a conveyancer should be able to clarify whether you are eligibility. In some cases you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer from beginning to end of the formalities.
Leasehold residencies in Market Harborough with in excess of 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and service charges merit 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; |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Irrespective of whether you are a tenant or a landlord in Market Harborough,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Market Harborough valuers.
Subsequent to protracted discussions with the freeholder of her purpose-built flat in Market Harborough, Amy started the lease extension process just as the lease was approaching the all-important 80-year deadline. The legal work was finalised in May 2014. The freeholder’s costs were kept to an absolute minimum.
In 2013 we were approached by Mr Theo Norbert who, having was assigned a lease of a ground floor apartment in Market Harborough in June 2003. We are asked if we could approximate the premium would be for a 90 year lease extension. Identical residencies in Market Harborough with a long lease were valued around £254,200. The mid-range amount of ground rent was £60 billed every twelve months. The lease ended in 2077. Considering the 51 years unexpired we estimated the premium to the freeholder to extend the lease to be between £43,700 and £50,600 plus legals.
Last Winter we were called by Mr and Mrs. T Roux , who was assigned a lease of a ground floor flat in Market Harborough in October 2004. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to prolong the lease by ninety years. Comparative flats in Market Harborough with an extended lease were in the region of £210,600. The average ground rent payable was £45 collected per annum. The lease ended on 7 September 2088. Considering the 62 years outstanding we estimated the premium to the landlord for the lease extension to be within £18,100 and £20,800 not including professional charges.