Chances are that where you own a flat in Morganstown you actually own a long leasehold interest over your property
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
The conveyancers 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 conveyancing solicitor we work with provide it.
Muhammad owned a conversion flat in Morganstown on the market with a lease of a few days over 59 years remaining. Muhammad informally spoke with his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £100 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Muhammad to invoke his statutory right. Muhammad procured expert advice and was able to make a more informed judgement and handle with the matter and readily saleable.
In 2012 we were approached by Mr B Laurent who, having completed a garden flat in Morganstown in May 2010. The dilemma was if we could estimate the premium would likely be to extend the lease by a further 90 years. Identical residencies in Morganstown with an extended lease were valued about £206,200. The average amount of ground rent was £55 billed quarterly. The lease lapsed in 2081. Considering the 56 years unexpired we calculated the compensation to the landlord to extend the lease to be between £31,400 and £36,200 plus fees.
Last Autumn we were contacted by Mr and Mrs. P James , who took over the lease of a purpose-built flat in Morganstown in November 2000. We are asked if we could estimate the premium would likely be for a ninety year lease extension. Identical premises in Morganstown with a long lease were valued around £300,000. The average amount of ground rent was £50 invoiced every twelve months. The lease terminated in 2101. Taking into account 76 years remaining we calculated the premium to the landlord for the lease extension to be within £8,600 and £9,800 plus professional charges.