Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will normally be granted for a fixed period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Needham Market. Inevitably, the length of lease remaining shortens over time. This is often ignored and only raises itself as an issue when the flat or house has to be disposed of or re-mortgaged. The fewer the years remaining the lower the value of the property and the more expensive it will be to procure a lease extension. Qualifying long lease owners in Needham Market have the legal entitlement to extend the lease for an additional 90 years in accordance with statute. Please give due deliberation before delaying your Needham Market lease extension. Putting off that expense now simply increases the price you will ultimately have to pay to extend your lease
Leasehold premises in Needham Market with in excess of 100 years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service will provide you increased control over the value of your Needham Market leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Kai was the the leasehold proprietor of a studio flat in Needham Market being marketed with a lease of fraction over sixty years remaining. Kai informally spoke with his landlord a well known Manchester-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 £125 per annum. No ground rent would be payable on a lease extension were Kai to exercise his statutory right. Kai obtained expert legal guidance and secured satisfactory deal informally and ending up with a market value flat.
Last Spring we were phoned by Mr and Mrs. J Baker , who acquired a one bedroom apartment in Needham Market in January 2004. We are asked if we could approximate the compensation to the landlord could be for a 90 year lease extension. Identical premises in Needham Market with 100 year plus lease were worth £205,000. The average amount of ground rent was £50 billed every twelve months. The lease came to a finish on 8 September 2104. Taking into account 78 years unexpired we estimated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 not including professional charges.
Mr and Mrs. N Roux completed a studio flat in Needham Market in January 2001. We are asked if we could approximate the price would likely be to prolong the lease by a further 90 years. Comparable flats in Needham Market with a long lease were worth £267,600. The mid-range amount of ground rent was £65 collected annually. The lease elapsed on 8 March 2093. Having 67 years left we calculated the compensation to the landlord to extend the lease to be within £14,300 and £16,400 plus fees.