Moorends 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 gets more expensive. It is the case that most Moorends tenants have the right to extend their lease by an additional 90 years under the 1993 Leasehold Reform Act. If you are a leasehold owner in Moorends you would be well advised to investigate if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be worth the same as 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you increased control over the value of your Moorends leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of protracted correspondence with the freeholder of her leasehold flat in Moorends, Abigail initiated the lease extension process as the 80 year deadline was rapidly advancing. The transaction completed in August 2014. The landlord’s costs were restricted to below 450 pounds.
Last Autumn we were e-mailed by Mr and Mrs. M André , who purchased a garden apartment in Moorends in January 2011. The question was if we could shed any light on how much (approximately) price would likely be for a ninety year extension to my lease. Comparative premises in Moorends with a long lease were valued about £245,000. The mid-range ground rent payable was £50 collected annually. The lease ran out on 24 June 2094. Having 68 years as a residual term we calculated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 exclusive of costs.
In 2011 we were e-mailed by Mr and Mrs. K Alexander who, having acquired a studio apartment in Moorends in April 1997. We are asked if we could approximate the premium would be for a 90 year lease extension. Identical flats in Moorends with 100 year plus lease were worth £285,000. The average amount of ground rent was £55 invoiced quarterly. The lease concluded in 2105. Considering the 79 years outstanding we calculated the compensation to the landlord for the lease extension to be within £13,300 and £15,400 exclusive of fees.