Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will normally be granted for a set period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Old Stratford. Clearly, the length of lease remaining reduces as time goes by. This is often ignored and only raises itself as an issue when the residence has to be disposed of or refinanced. The shorter the lease the less it is worth and the more expensive it will be to obtain a lease extension. Eligible leaseholders in Old Stratford have the legal entitlement to extend the lease for an additional ninety years in accordance with the 1993 Leasehold Reform Act. Please give careful attention before delaying your Old Stratford lease extension. Putting off that expense now simply increases the price you will eventually have to pay to extend your lease
Leasehold properties in Old Stratford with more than one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Chelsea 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with handle Old Stratford 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 lawyer we work with provide it.
Thomas owned a high value apartment in Old Stratford being marketed with a lease of a few days over 61 years outstanding. Thomas on an informal basis spoke with his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent initially set at £200 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Thomas to invoke his statutory right. Thomas procured expert advice and secured satisfactory deal informally and sell the property.
In 2009 we were called by Mrs Alice Collins who, having bought a basement flat in Old Stratford in February 2005. The dilemma was if we could estimate the price would likely be to extend the lease by an additional years. Similar properties in Old Stratford with 100 year plus lease were worth £275,000. The mid-range amount of ground rent was £55 collected monthly. The lease came to a finish in 2102. Having 77 years as a residual term we estimated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 plus expenses.
Dr A Hernández acquired a purpose-built flat in Old Stratford in September 2012. We are asked if we could estimate the compensation to the landlord would likely be to extend the lease by ninety years. Comparative residencies in Old Stratford with an extended lease were in the region of £183,600. The average amount of ground rent was £65 invoiced monthly. The lease terminated in 2082. Given that there were 57 years unexpired we calculated the compensation to the landlord to extend the lease to be between £28,500 and £33,000 exclusive of legals.