Unfortunately that a Priorslee residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the Priorslee property market.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips under eighty years - otherwise a higher premium will be payable. Most leasehold owners in Priorslee will be able to extend under the legislation; however a conveyancer should be able to confirm if you qualify for an extension. In some cases you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the process.
Leasehold residencies in Priorslee with over one hundred years unexpired 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 premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges merit 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
Engaging our service will provide you better control over the value of your Priorslee leasehold, as your property will be more valuable and saleable in respect of lease length should you wish 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 year Felix, started to get close to the 80-year threshold with the lease on his two bedroom apartment in Priorslee. In buying his flat two decades ago, the unexpired term was of minimal concern. Fortunately, he became aware that he would imminently be paying way over the odds for a lease extension. Felix was able to extend his lease at the eleventh hour in January. Felix and the freeholder ultimately settled on the final figure of £5,000 . If the lease had fallen to less than 80 years, the price would have gone up by a minimum £1,100.
Ms Y Robinson moved into a newly refurbished apartment in Priorslee in January 2002. The dilemma was if we could estimate the compensation to the landlord would likely be to extend the lease by a further 90 years. Comparative flats in Priorslee with a long lease were in the region of £280,000. The mid-range ground rent payable was £45 billed annually. The lease ended in 2096. Given that there were 70 years as a residual term we estimated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 not including fees.
Last Summer we were approach by Mr William Richardson , who took over the lease of a one bedroom flat in Priorslee in August 2001. The question was if we could shed any light on how much (roughly) compensation to the landlord would be for a ninety year lease extension. Similar properties in Priorslee with a long lease were valued about £223,400. The average ground rent payable was £60 collected every twelve months. The lease ended on 6 November 2085. Considering the 59 years unexpired we approximated the compensation to the landlord to extend the lease to be within £27,600 and £31,800 exclusive of professional charges.