Netherne leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Netherne residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Netherne you would be well advised to check if your lease has between seventy and 90 years remaining. There are compelling reasons why a Netherne leaseholder with a lease having around eighty years remaining should take steps to make sure that a lease extension is actioned without delay
Leasehold properties in Netherne with more than one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 |
| 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 undertake Netherne 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.
In the wake of 6 months of lengthy negotiations with the freeholder of her ground floor apartment in Netherne, Nicole started the lease extension process just as her lease was nearing the critical 80-year threshold. The legal work was finalised in February 2011. The freeholder’s fees were kept to an absolute minimum.
Last Autumn we were e-mailed by Mr N Wright , who took over the lease of a garden apartment in Netherne in January 2012. The question was if we could estimate the price would be to extend the lease by a further 90 years. Similar residencies in Netherne with 100 year plus lease were worth £233,200. The mid-range amount of ground rent was £60 billed monthly. The lease ended in 2087. Having 61 years outstanding we estimated the premium to the freeholder to extend the lease to be within £22,800 and £26,400 exclusive of expenses.
An example of a Freehold Enfranchisement case for a Netherne flat is 223 Brighton Road in September 2013. The premium payable for the acquisition freehold of the properties should be £10,934 (Ten thousand,nine hundred and thirty four pounds) This case affected 3 flats. The unexpired term as at the valuation date was 75 years.