The re-sale value of a leasehold property in Morganstown depends on how long the lease has left to run. If it is near to or less than 80 years you should envisage difficulties on re-sale, so it is recommended to arrange for a lease extension prior to purchasing. Ideally one should start the lease extension process when the lease still has 82 years remaining so that a lease extension can be addressed in advance of the 80 year mark. Statute entitles Morganstown qualifying lessees to an additional term of ninety years in addition to the remaining term, at a nominal rent (zero ground rent). The purpose of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold premises in Morganstown with over 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
The lawyers that we work with handle Morganstown lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Felix was the the leasehold proprietor of a studio apartment in Morganstown being marketed with a lease of just over 59 years outstanding. Felix on an informal basis spoke with his landlord a well known London-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of a rise in the rent to £50 per annum. No ground rent would be due on a lease extension were Felix to invoke his statutory right. Felix procured expert advice and was able to make an informed decision and deal with the matter and sell the property.
Last Christmas we were contacted by Mr and Mrs. I Ramírez , who purchased a first floor flat in Morganstown in April 2010. We are asked if we could shed any light on how much (approximately) price would likely be for a 90 year lease extension. Similar flats in Morganstown with a long lease were in the region of £233,200. The average ground rent payable was £60 collected yearly. The lease ran out on 17 May 2087. Taking into account 61 years left we estimated the premium to the landlord to extend the lease to be between £22,800 and £26,400 exclusive of expenses.
Dr K Davies purchased a one bedroom apartment in Morganstown in August 2012. The dilemma was if we could shed any light on how much (approximately) premium would be for a ninety year lease extension. Identical homes in Morganstown with a long lease were in the region of £171,800. The mid-range ground rent payable was £55 billed every twelve months. The lease expiry date was on 25 August 2076. Having 50 years left we approximated the compensation to the landlord to extend the lease to be between £33,300 and £38,400 plus expenses.