As the the remaining lease term of a New Brighton residential lease diminished so does its value and therefore the value of your property. Where the residual term has, beyond 100 years remaining then this decrease may be of little impact however there will become a stage when a lease has under than 80 years left as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the primary rational as to why you should extend the lease sooner than later. Most flat owners in New Brighton will qualify for this right; nevertheless a conveyancer can advise whether you are eligible to extend your lease. In limited situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to any lease with more than 30 years unexpired, the residence will be equivalent in value to a freehold for many years in the future.
| 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. |
| Chelsea Building Society | 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. |
| Halifax | Minimum 70 years from the date 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. |
Engaging our service gives you better control over the value of your New Brighton leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last October Harvey, came precariously close to the eighty-year threshold with the lease on his ground floor flat in New Brighton. Having purchased his property two decades ago, the unexpired term was of little interest. Fortunately, he recognised he would imminently be paying way over the odds for a lease extension. Harvey arranged for a lease extension just under the wire last July. Harvey and the freeholder subsequently agreed on a premium of £6,000 . If he failed to meet the deadline, the price would have gone up by a minimum £1,100.
In 2011 we were contacted by Mrs Alicia Walker who, having owned a one bedroom apartment in New Brighton in September 1995. The dilemma was if we could approximate the price would likely be to extend the lease by a further 90 years. Identical premises in New Brighton with 100 year plus lease were worth £208,200. The mid-range amount of ground rent was £65 invoiced yearly. The lease ended in 2086. Given that there were 61 years as a residual term we calculated the premium to the freeholder to extend the lease to be within £20,000 and £23,000 exclusive of costs.
Mr Luke Cook owned a one bedroom apartment in New Brighton in April 2004. The question was if we could shed any light on how much (approximately) premium would likely be for a 90 year lease extension. Similar premises in New Brighton with 100 year plus lease were in the region of £260,000. The mid-range ground rent payable was £50 invoiced annually. The lease lapsed in 2097. Having 72 years remaining we calculated the premium to the landlord to extend the lease to be between £9,500 and £11,000 not including legals.