Penshaw leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. It is the case that most Penshaw tenants have the right to extend their lease by an additional 90 years in accordance with the 1993 Leasehold Reform Act. If you are a leasehold owner in Penshaw you really ought to investigate if your lease has between 70 and 90 years left. There are compelling reasons why a Penshaw flat owner with a lease having around eighty years unexpired should take steps to make sure that a lease extension is effected without delay
Leasehold premises in Penshaw with more than one hundred years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
Engaging our service gives you enhanced control over the value of your Penshaw leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last Summer Harvey, started to get close to the eighty-year mark with the lease on his ground floor flat in Penshaw. In buying his property two decades ago, the length of the lease was of no concern. Thankfully, it dawned on him that he would soon be paying an escalated premium for Extending the lease. Harvey was able to extend his lease at the eleventh hour last May. Harvey and the landlord in the end agreed on the final figure of £5,000 . If the lease had gone lower than 80 years, the premium would have become more costly by a minimum £1,075.
Last September we were e-mailed by Dr Ellie Brown , who purchased a one bedroom apartment in Penshaw in August 2003. The question was if we could estimate the compensation to the landlord would be to extend the lease by an additional years. Similar flats in Penshaw with 100 year plus lease were valued about £220,400. The average amount of ground rent was £45 invoiced every twelve months. The lease ran out in 2089. Considering the 64 years as a residual term we approximated the premium to the freeholder to extend the lease to be between £15,200 and £17,600 not including expenses.
Mr and Mrs. F Robinson acquired a ground floor apartment in Penshaw in August 2009. The dilemma was if we could estimate the compensation to the landlord would likely be for a 90 year extension to my lease. Comparative flats in Penshaw with 100 year plus lease were worth £270,000. The average amount of ground rent was £55 billed every twelve months. The lease terminated in 2100. Considering the 75 years left we approximated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of fees.