Marks Gate leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. It is the case that most Marks Gate tenants have the right to extend their lease by an additional 90 years in accordance with the 1993 Leasehold Reform Act. If you are a leasehold owner in Marks Gate you must check if your lease has between 70 and 90 years remaining. There are good reasons why a Marks Gate flat owner with a lease having around eighty years left should take steps to make sure that a lease extension is actioned without delay
It is generally accepted that a property with in excess of one hundred years remaining is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| 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. |
| 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. |
Lease extensions in Marks Gate can be a difficult process. We recommend you secure guidance from a conveyancer and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring Marks Gate lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Half a year ago Stanley, started to get close to the 80-year threshold with the lease on his leasehold apartment in Marks Gate. In buying his home twenty years previously, the unexpired term was of little interest. Thankfully, it dawned on him that he needed to take action soon on a lease extension. Stanley extended the lease at the eleventh hour in May. Stanley and the landlord who owned the flat above subsequently settled on an amount of £6,000 . If the lease had dropped lower than 80 years, the premium would have gone up by a minimum £950.
In 2013 we were contacted by Mr and Mrs. I Richardson who, having purchased a studio flat in Marks Gate in August 2010. We are asked if we could shed any light on how much (roughly) premium would likely be for a 90 year extension to my lease. Comparative flats in Marks Gate with 100 year plus lease were in the region of £233,200. The mid-range amount of ground rent was £60 invoiced yearly. The lease elapsed on 22 February 2086. Having 61 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £22,800 and £26,400 not including costs.
An example of a Lease Extension matter before the tribunal for a Marks Gate premises is 49 Aldborough Road South in July 2012. The Tribunal decided that the premium payable for the grant of the new lease was £13,925 This case related to 1 flat. The unexpired term as at the valuation date was 61.36 years.