North Shields leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. Most owners of residential leasehold property in North Shields enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in North Shields you really ought to investigate if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under eighty years, the amount payable for any lease extension increases dramatically as part of the premium you pay is what is known as a marriage value
It is conventional wisdom that a property with over 100 years remaining is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 30 years remaining, the premises will be equivalent in value to a freehold for decades to come.
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
The conveyancers that we work with undertake North Shields lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancer we work with provide it.
In recent months Logan, started to get near to the 80-year mark with the lease on his purpose- built flat in North Shields. In buying his property two decades ago, the lease term was of no concern. Luckily, it dawned on him that he would soon be paying way over the odds for a lease extension. Logan arranged for a lease extension just under the wire last July. Logan and the freeholder in the end settled on a premium of £5,000 . If the lease had gone below eighty years, the price would have gone up by a minimum £1,050.
In 2009 we were called by Dr Sam Miller who, having completed a ground floor flat in North Shields in October 2011. The question was if we could shed any light on how much (roughly) compensation to the landlord would be to prolong the lease by a further 90 years. Similar flats in North Shields with 100 year plus lease were valued about £290,000. The average amount of ground rent was £60 collected monthly. The lease terminated in 2105. Having 80 years remaining we approximated the premium to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of professional charges.
Dr Y Torres moved into a basement apartment in North Shields in September 2007. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be for a 90 year extension to my lease. Comparative homes in North Shields with 100 year plus lease were worth £200,800. The average amount of ground rent was £65 collected annually. The lease termination date was on 15 February 2085. Taking into account 60 years as a residual term we approximated the premium to the landlord to extend the lease to be within £20,900 and £24,200 exclusive of costs.