Owning a flat usually means owning a lease of the property, which has a set term of years. The lease will normally be granted for a fixed period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Newburn. Clearly, the term of lease left reduces over time. This is often ignored and only becomes a problem when the residence has to be disposed of or refinanced. The fewer the years remaining the lower the value of the property and the more it will cost to extend the lease. Eligible long lease owners in Newburn have the legal entitlement to extend the lease for a further ninety years in accordance with statute. You should give careful deliberation before delaying your Newburn lease extension. Holding off that expense now simply increases the price you will eventually incur to extend your lease
It is conventional wisdom that a residential leasehold with more than one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to any lease with more than 45 years unexpired, the premises will be worth the same as a freehold for many years ahead.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service will provide you increased control over the value of your Newburn leasehold, as your property will be more valuable and saleable in respect of lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last Spring Adam, started to get close to the eighty-year mark with the lease on his studio flat in Newburn. Having purchased his home two decades ago, the length of the lease was of little interest. Thankfully, he realised he would imminently be paying way over the odds for a lease extension. Adam extended the lease just in the nick of time in January. Adam and the freeholder via the management company eventually settled on an amount of £5,500 . If he had missed the deadline, the sum would have become more costly by a minimum £975.
Last month we were contacted by Mr and Mrs. S Rose , who purchased a recently refurbished apartment in Newburn in October 2005. We are asked if we could shed any light on how much (approximately) premium could be to prolong the lease by a further 90 years. Comparable premises in Newburn with 100 year plus lease were worth £240,600. The average ground rent payable was £65 invoiced monthly. The lease end date was in 2087. Considering the 62 years left we calculated the compensation to the freeholder to extend the lease to be between £21,900 and £25,200 plus expenses.
In 2012 we were contacted by Mr and Mrs. G Martinez who, having was assigned a lease of a one bedroom apartment in Newburn in June 2001. The dilemma was if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Identical residencies in Newburn with a long lease were in the region of £181,600. The average amount of ground rent was £55 invoiced monthly. The lease finished in 2077. Taking into account 52 years outstanding we estimated the premium to the landlord to extend the lease to be within £30,400 and £35,200 not including fees.