There is no doubt about it a leasehold flat or house in Oadby is a wasting asset as a result of the diminishing lease term. Where the residual term has, in excess of one hundred years to run then this decrease may be fractional however there will become a point in time when a lease has under than eighty years unexpired as part of the premium you will incur is what is known as a marriage value. This could increase sharply the cost. It is the primary reason why you should extend the lease without delay. Many flat owners in Oadby will qualify for this right; nevertheless a conveyancer will be able to confirm whether you are eligible to extend your lease. In limited situations you may not qualify, the most common reason being that you have owned the property for less than two years.
It is conventional wisdom that a residential leasehold with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service will provide you enhanced control over the value of your Oadby leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Last Christmas Alfie, started to get close to the eighty-year threshold with the lease on his garden flat in Oadby. In buying his flat 19 years ago, the length of the lease was of little importance. Fortunately, he became aware that he needed to take action soon on Extending the lease. Alfie arranged for a lease extension at the eleventh hour last May. Alfie and the landlord eventually settled on a premium of £5,000 . If the lease had descended to less than eighty years, the price would have escalated by a minimum £875.
Last Spring we were e-mailed by Mr and Mrs. K Walker , who acquired a recently refurbished apartment in Oadby in January 1996. The question was if we could shed any light on how much (roughly) premium could be for a ninety year extension to my lease. Comparable premises in Oadby with 100 year plus lease were valued about £233,200. The average amount of ground rent was £60 billed annually. The lease finished in 2086. Considering the 61 years as a residual term we approximated the compensation to the freeholder to extend the lease to be between £22,800 and £26,400 not including expenses.
In 2012 we were contacted by Mr and Mrs. M Parker who, having bought a ground floor flat in Oadby in April 2002. We are asked if we could estimate the compensation to the landlord would be to prolong the lease by ninety years. Comparable residencies in Oadby with an extended lease were valued about £171,800. The average ground rent payable was £55 billed quarterly. The lease came to a finish in 2075. Considering the 50 years as a residual term we estimated the compensation to the landlord for the lease extension to be between £33,300 and £38,400 exclusive of legals.