It’s an underpublicised certainty that a Minera residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the reduction being disguised by increases in the Minera property market.Where your lease has approximately 90 years left, you need to start considering a lease extension. If lease term dips under eighty years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property The majority of flat owners in Minera will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm whether you qualify for an extension. In some situations you may not qualify. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancer from beginning to end of the formalities.
Leasehold properties in Minera with more than one hundred years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| Yorkshire 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. |
Engaging our service will provide you increased control over the value of your Minera leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Following lengthy negotiations with the freeholder of her studio apartment in Minera, Alisha commenced the lease extension process as the 80 year mark was fast approaching. The transaction completed in September 2006. The freeholder’s fees were negotiated to under 600 pounds.
Last year we were phoned by Dr O Thomas , who acquired a one bedroom flat in Minera in October 1996. We are asked if we could shed any light on how much (roughly) premium could be for a ninety year extension to my lease. Comparative properties in Minera with a long lease were valued around £260,000. The mid-range ground rent payable was £50 collected monthly. The lease lapsed on 13 November 2097. Taking into account 71 years as a residual term we approximated the premium to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of costs.
Last Summer we were e-mailed by Mr and Mrs. O Cox , who moved into a purpose-built apartment in Minera in August 1995. We are asked if we could estimate the premium would likely be to extend the lease by a further 90 years. Identical properties in Minera with an extended lease were worth £254,200. The average ground rent payable was £60 collected quarterly. The lease ended in 2077. Given that there were 51 years outstanding we approximated the premium to the landlord for the lease extension to be within £43,700 and £50,600 exclusive of expenses.