Midsomer Norton leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Midsomer Norton residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Midsomer Norton you should check if your lease has between seventy and ninety years remaining. In particular once the remaining lease term slips under 80 years, the cost of any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
It is generally accepted that a property with more than 100 years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 30 years remaining, the premises 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. |
| 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; |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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 |
Regardless of whether you are a tenant or a freeholder in Midsomer Norton,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Midsomer Norton valuers.
Last October Jacob, came seriously near to the eighty-year threshold with the lease on his two bedroom apartment in Midsomer Norton. In buying his property 19 years ago, the length of the lease was of no relevance. Fortunately, he realised he would imminently be paying an inflated amount for a lease extension. Jacob extended the lease at the eleventh hour in March. Jacob and the freeholder via the management company ultimately agreed on the final figure of £6,000 . If the lease had slid below 80 years, the sum would have gone up by at least £850.
In 2014 we were phoned by Mr F Bonnet who, having completed a one bedroom flat in Midsomer Norton in July 2004. We are asked if we could estimate the premium would likely be to extend the lease by ninety years. Similar homes in Midsomer Norton with 100 year plus lease were valued around £166,800. The mid-range amount of ground rent was £50 billed annually. The lease expired on 4 January 2076. Taking into account 50 years unexpired we estimated the compensation to the landlord to extend the lease to be within £32,300 and £37,400 not including legals.
Mr A Gómez moved into a garden flat in Midsomer Norton in August 2009. The question was if we could shed any light on how much (approximately) price would be to extend the lease by an additional years. Identical residencies in Midsomer Norton with 100 year plus lease were in the region of £280,000. The mid-range amount of ground rent was £45 collected monthly. The lease concluded on 7 October 2096. Considering the 70 years remaining we calculated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 plus professional charges.