With a residential leasehold property in Norris Green, you are actually buying a right to live in a property for a prescribed time frame. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you should consider a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately greater especially once there are fewer than 80 years remaining. Leasehold owners in Norris Green with a lease approaching 81 years unexpired should seriously consider extending it as soon as possible. Once a lease has under eighty years left, under the current statute the landlord can calculate and levy a larger premium, assessed on a technical multiplication, strangely termed as “marriage value” which is payable.
It is generally accepted that a residential leasehold with in excess of one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 30 years remaining, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Yorkshire 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. |
Irrespective of whether you are a tenant or a landlord in Norris Green,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Norris Green valuers.
Nathaniel owned a studio apartment in Norris Green being sold with a lease of a little over 72 years unexpired. Nathaniel informally spoke with his landlord a well known Bristol-based freehold company for a lease extension. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £150 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Nathaniel to exercise his statutory right. Nathaniel obtained expert advice and was able to make a more informed decision and deal with the matter and sell the property.
In 2010 we were e-mailed by Dr Bethan Brown who, having purchased a studio apartment in Norris Green in August 2001. We are asked if we could approximate the price could be to extend the lease by an additional years. Similar residencies in Norris Green with an extended lease were worth £166,800. The average ground rent payable was £50 collected monthly. The lease came to a finish in 2076. Taking into account 50 years left we approximated the premium to the freeholder for the lease extension to be between £32,300 and £37,400 plus fees.
In 2012 we were approached by Mr and Mrs. W Simon who, having owned a garden apartment in Norris Green in October 2001. We are asked if we could estimate the compensation to the landlord would likely be to prolong the lease by ninety years. Comparable flats in Norris Green with 100 year plus lease were worth £280,000. The mid-range amount of ground rent was £45 collected annually. The lease finished on 5 November 2096. Given that there were 70 years outstanding we calculated the premium to the freeholder for the lease extension to be between £12,400 and £14,200 exclusive of professional charges.