The closer a domestic lease in Potswood gets to zero years unexpired, the the greater the reduction in the value of the property. If the lease has, beyond 100 years to run then this decrease may be of little impact that being said there will become a point in time when a lease has fewer than 80 years remaining as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the main rational as to why you should consider extending without delay. The majority of flat owners in Potswood will meet the qualifying criteria; that being said a conveyancer should be able to confirm whether you are eligible for a lease extension. In certain situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
It is generally accepted that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the residence will be worth the same as a freehold for many years ahead.
| 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with undertake Potswood 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.
Off the back of protracted correspondence with the freeholder of her first floor apartment in Potswood, Hannah initiated the lease extension process as the eighty year threshold was quickly approaching. The lease extension was finalised in April 2007. The freeholder’s charges were kept to an absolute minimum.
In 2010 we were phoned by Dr N Brown who, having moved into a one bedroom flat in Potswood in June 2000. We are asked if we could estimate the premium could be for a ninety year extension to my lease. Similar flats in Potswood with 100 year plus lease were in the region of £208,200. The average ground rent payable was £65 invoiced annually. The lease expired in 2086. Having 61 years unexpired we approximated the premium to the landlord to extend the lease to be within £19,000 and £22,000 not including expenses.
In 2012 we were approached by Mr Reuben Alexander who, having completed a ground floor flat in Potswood in May 2001. We are asked if we could estimate the premium could be to prolong the lease by a further 90 years. Comparable premises in Potswood with 100 year plus lease were in the region of £260,000. The average ground rent payable was £50 invoiced quarterly. The lease finished on 7 October 2097. Considering the 72 years left we estimated the premium to the landlord to extend the lease to be between £9,500 and £11,000 plus professional charges.