Ponteland leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. Legislation has been in place for sometime now which permits qualifying Ponteland residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Ponteland you really ought to see if your lease has between seventy and ninety years remaining. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
Leasehold premises in Ponteland with more than one hundred years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Birmingham Midshires | 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. |
| Coventry Building Society | 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. |
| 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. |
Retaining our service will provide you increased control over the value of your Ponteland leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to protracted negotiations with the landlord of her ground floor apartment in Ponteland, Natasha initiated the lease extension process just as her lease was coming close to the all-important eighty-year deadline. The lease extension was concluded in June 2013. The landlord’s costs were kept to an absolute minimum.
Mr and Mrs. G Lewis was assigned a lease of a studio flat in Ponteland in August 1995. The question was if we could estimate the premium would likely be to prolong the lease by 90 years. Comparable homes in Ponteland with an extended lease were valued around £205,000. The mid-range amount of ground rent was £50 invoiced monthly. The lease lapsed on 26 July 2105. Given that there were 79 years left we approximated the premium to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of legals.
Last Spring we were phoned by Mr Nathan Clarke , who moved into a purpose-built apartment in Ponteland in September 2010. The dilemma was if we could estimate the premium would likely be for a 90 year lease extension. Comparable properties in Ponteland with an extended lease were valued around £275,000. The mid-range ground rent payable was £65 invoiced yearly. The lease came to a finish on 26 February 2094. Considering the 68 years unexpired we approximated the premium to the landlord for the lease extension to be within £12,400 and £14,200 exclusive of professional charges.