Minera leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. The majority of owners of residential leasehold property in Minera enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Minera you would be well advised to investigate 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 increases dramatically as part of the premium you will incur is what is known as a marriage value
It is conventional wisdom that a residential leasehold with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Godiva Mortgages | 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Irrespective of whether you are a tenant or a landlord in Minera,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 in-depth market knowledge and the close ties they enjoy with Minera valuers.
Oscar owned a 2 bedroom apartment in Minera on the market with a lease of fraction over 59 years remaining. Oscar on an informal basis approached his freeholder a well known Manchester-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Oscar to exercise his statutory right. Oscar obtained expert advice and secured satisfactory resolution without going to tribunal and ending up with a market value flat.
In 2009 we were approached by Dr E Vincent who, having owned a first floor apartment in Minera in June 2010. The dilemma was if we could approximate the compensation to the landlord would be for a ninety year lease extension. Identical residencies in Minera with 100 year plus lease were worth £208,200. The mid-range ground rent payable was £65 collected quarterly. The lease ran out in 2087. Having 61 years outstanding we calculated the compensation to the freeholder to extend the lease to be between £20,000 and £23,000 not including expenses.
In 2011 we were phoned by Mr and Mrs. L Garcia who, having purchased a purpose-built flat in Minera in July 2010. The question was if we could shed any light on how much (approximately) compensation to the landlord would likely be to extend the lease by ninety years. Comparative residencies in Minera with 100 year plus lease were valued about £260,000. The average amount of ground rent was £50 collected per annum. The lease concluded in 2098. Having 72 years remaining we approximated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 plus expenses.