On the balance of probabilities where you own a flat in Melbourne you actually own a long leasehold interest over your property
It is conventional wisdom that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 |
Lease extensions in Melbourne can be a difficult process. We recommend you secure professional help 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 a wealth of experience dealing with Melbourne lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Jonathan owned a conversion apartment in Melbourne on the market with a lease of fraction over sixty years remaining. Jonathan informally spoke with his landlord a well known local-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years on the basis of a rise in the rent to £100 per annum. Ordinarily, ground rent would not be due on a lease extension were Jonathan to exercise his statutory right. Jonathan obtained expert advice and secured an acceptable resolution informally and readily saleable.
Last October we were phoned by Dr Noah Cook , who was assigned a lease of a one bedroom flat in Melbourne in June 1999. The question was if we could estimate the premium would likely be to extend the lease by an additional years. Comparative residencies in Melbourne with an extended lease were in the region of £174,200. The average ground rent payable was £55 collected annually. The lease elapsed in 2077. Given that there were 51 years outstanding we estimated the premium to the freeholder to extend the lease to be between £31,400 and £36,200 plus legals.
In 2009 we were e-mailed by Mr Teddy David who, having bought a studio apartment in Melbourne in November 1995. The question was if we could shed any light on how much (roughly) premium would likely be for a 90 year extension to my lease. Identical homes in Melbourne with an extended lease were worth £285,000. The mid-range amount of ground rent was £45 billed per annum. The lease terminated on 14 January 2097. Taking into account 71 years remaining we estimated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 not including expenses.