Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will ordinarily be granted for a set period of time , usually 99 or 125 years, although we have come across longer and shorter terms in Niton. Inevitably, the length of lease remaining reduces as time goes by. This is often overlooked and only raises itself as an issue when the flat or house needs to be disposed of or re-mortgaged. The shorter the lease the lower the value of the property and the more it will cost to procure a lease extension. Qualifying long lease owners in Niton have the legal entitlement to extend the lease for an additional 90 years in accordance with statute. You should give careful deliberation before delaying your Niton lease extension. Holding off the cost now simply increases the price you will ultimately incur for a lease extension
It is generally considered that a property with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for many years in the future.
| 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. |
| 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 increased control over the value of your Niton leasehold, as your property will be more valuable and saleable in respect of lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Oliver owned a 2 bedroom apartment in Niton on the market with a lease of fraction over 72 years unexpired. Oliver informally approached his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £125 per annum. No ground rent would be due on a lease extension were Oliver to exercise his statutory right. Oliver procured expert legal guidance and was able to make an informed decision and handle with the matter and sell the flat.
Last January we were e-mailed by Mr and Mrs. G Williams , who bought a one bedroom flat in Niton in March 1996. The question was if we could approximate the compensation to the landlord would likely be to extend the lease by ninety years. Identical flats in Niton with a long lease were in the region of £285,000. The average ground rent payable was £45 collected monthly. The lease terminated on 6 July 2096. Taking into account 71 years outstanding we approximated the premium to the landlord for the lease extension to be between £12,400 and £14,200 plus costs.
Last Summer we were approach by Mr and Mrs. I Collins , who was assigned a lease of a ground floor apartment in Niton in February 1999. The question was if we could approximate the price would likely be for a 90 year lease extension. Comparative properties in Niton with 100 year plus lease were worth £233,200. The mid-range ground rent payable was £60 collected yearly. The lease elapsed in 2086. Given that there were 61 years unexpired we estimated the compensation to the freeholder for the lease extension to be between £22,800 and £26,400 plus expenses.