As the the remaining lease term of a Norris Green residential lease decreases so does its value and therefore the value of your property. Where the lease has, over 100 years to run then this decrease may be negligible that being said there will become a stage when a lease has less than eighty years left as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the primary reason why you should consider extending without delay. Many flat owners in Norris Green will qualify for this right; nevertheless a lawyer can advise if you qualify to extend your lease. In limited situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold properties in Norris Green with more than one hundred years left on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Engaging our service will provide you increased control over the value of your Norris Green leasehold, as your property will be more valuable and saleable in terms 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.
James was the the leasehold proprietor of a conversion flat in Norris Green being marketed with a lease of fraction over sixty years left. James on an informal basis contacted his freeholder being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years subject to a new rent to start with set at £200 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were James to exercise his statutory right. James obtained expert advice and was able to make a more informed decision and handle with the matter and ending up with a market value flat.
Dr Y Adams owned a newly refurbished apartment in Norris Green in February 2010. The question was if we could estimate the premium could be for a ninety year extension to my lease. Similar flats in Norris Green with an extended lease were in the region of £198,800. The average ground rent payable was £55 collected per annum. The lease came to a finish in 2081. Having 55 years left we approximated the premium to the landlord to extend the lease to be between £33,300 and £38,400 exclusive of fees.
In 2014 we were phoned by Dr A Bonnet who, having moved into a ground floor flat in Norris Green in February 2012. We are asked if we could estimate the compensation to the landlord would be to prolong the lease by 90 years. Comparable properties in Norris Green with 100 year plus lease were in the region of £295,000. The mid-range amount of ground rent was £50 collected yearly. The lease terminated in 2101. Considering the 75 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 plus costs.