The closer a domestic lease in Olney gets to zero years unexpired, the more it reduces the value of the property. Where the lease has, over 125 years remaining then this decrease may be fractional that being said there will become a stage when a lease has less than eighty years remaining 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 main logic behind why you should extend the lease sooner than later. The majority of flat owners in Olney will meet the qualifying criteria; however a lawyer can confirm if you qualify for a lease extension. 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 premises in Olney with over 100 years outstanding 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 reversionary interest unless savings on ground rent and estate charges merit 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. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with undertake Olney 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.
Two years ago Kai, came critically close to the 80-year threshold with the lease on his two bedroom apartment in Olney. In buying his home twenty years previously, the length of the lease was of little interest. Thankfully, he realised he needed to take steps soon on a lease extension. Kai extended the lease at the eleventh hour last June. Kai and the landlord in the end settled on a premium of £5,000 . If the lease had dipped below 80 years, the amount would have gone up by a minimum £975.
Last month we were called by Ms M James , who acquired a one bedroom apartment in Olney in March 2009. We are asked if we could estimate the price would be to prolong the lease by 90 years. Similar premises in Olney with an extended lease were valued about £280,000. The average amount of ground rent was £55 billed yearly. The lease end date was in 2103. Taking into account 78 years outstanding we approximated the compensation to the landlord for the lease extension to be between £13,300 and £15,400 not including costs.
Mr and Mrs. O Richardson acquired a one bedroom flat in Olney in May 2002. We are asked if we could shed any light on how much (approximately) price could be to prolong the lease by 90 years. Comparable homes in Olney with 100 year plus lease were worth £191,000. The average amount of ground rent was £65 invoiced annually. The lease terminated on 13 February 2083. Given that there were 58 years outstanding we calculated the compensation to the freeholder to extend the lease to be within £23,800 and £27,400 exclusive of legals.