Newmarket leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease becomes more expensive. It is the case that most Newmarket tenants have the right to extend their lease by an additional ninety years by virtue of the 1993 Leasehold Reform Act. Where you are a leasehold owner in Newmarket you would be well advised to check if your lease has between 70 and 90 years remaining. There are compelling reasons why a Newmarket leaseholder with a lease having around eighty years remaining should take steps to ensure that a lease extension is effected without delay
Leasehold properties in Newmarket with more than 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Godiva Mortgages | 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Newmarket can be a difficult process. We recommend you get guidance from a conveyancer and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Newmarket lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Trailing unsuccessful discussions with the landlord of her leasehold flat in Newmarket, Rosie commenced the lease extension process just as the lease was approaching the all-important eighty-year threshold. The transaction was finalised in January 2005. The landlord’s fees were kept to an absolute minimum.
In 2013 we were approached by Mr and Mrs. M Anderson who, having completed a garden flat in Newmarket in November 2005. The dilemma was if we could approximate the price would be to extend the lease by 90 years. Similar homes in Newmarket with 100 year plus lease were valued about £189,000. The average ground rent payable was £55 invoiced every twelve months. The lease expired on 8 February 2078. Having 53 years remaining we approximated the compensation to the freeholder for the lease extension to be within £28,500 and £33,000 plus costs.
In 2010 we were called by Mr A Anderson who, having acquired a newly refurbished flat in Newmarket in October 1999. The question was if we could estimate the premium would likely be for a 90 year extension to my lease. Comparative residencies in Newmarket with an extended lease were in the region of £290,000. The average ground rent payable was £45 billed every twelve months. The lease came to a finish in 2098. Taking into account 73 years unexpired we calculated the premium to the landlord to extend the lease to be between £9,500 and £11,000 plus expenses.