The re-sale value of a leasehold property in Milton Keynes is impacted by how many years the lease has remaining. If it is close to or fewer than 80 years you should anticipate problems on re-sale, so it is advisable to arrange for a lease extension before purchasing. Ideally one should start the lease extension process when a lease still has 82 years unexpired so that formalities can be addressed in advance of the eighty year cut off point. Statute entitles Milton Keynes qualifying lessees to an additional term of 90 years on top of the existing term, at a nominal rent (no ground rent). The intention of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to any lease with more than 30 years unexpired, the property will be equivalent in value to a freehold for many years ahead.
| 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| 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 Milton Keynes can be a difficult process. We recommend you obtain guidance from a conveyancing solicitor and valuer with experience in this area.
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 dealing with Milton Keynes lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In the wake of 6 months of unsuccessful negotiations with the freeholder of her basement apartment in Milton Keynes, Courtney commenced the lease extension process just as her lease was approaching the crucial 80-year mark. The legal work was concluded in June 2007. The landlord’s charges were kept to an absolute minimum.
In 2009 we were approached by Dr Freya Cook who, having was assigned a lease of a recently refurbished flat in Milton Keynes in January 2006. We are asked if we could estimate the compensation to the landlord could be to prolong the lease by an additional years. Similar residencies in Milton Keynes with a long lease were valued around £285,000. The mid-range ground rent payable was £45 invoiced every twelve months. The lease ran out in 2097. Taking into account 72 years remaining we approximated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 exclusive of fees.
Last year we were called by Mr and Mrs. D Davies , who bought a newly refurbished flat in Milton Keynes in June 2004. We are asked if we could estimate the compensation to the landlord could be for a ninety year lease extension. Identical properties in Milton Keynes with an extended lease were worth £233,200. The mid-range ground rent payable was £60 billed quarterly. The lease lapsed in 2086. Given that there were 61 years left we calculated the compensation to the freeholder to extend the lease to be within £22,800 and £26,400 plus professional charges.