Purley leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. It is the case that most Purley tenants have the right to extend their lease by an additional ninety years under the 1993 Leasehold Reform Act. Where you are a leasehold owner in Purley you really ought to see if your lease has between 70 and 90 years left. There are good reasons why a Purley leaseholder with a lease having around 80 years remaining should take steps to make sure that a lease extension is actioned without delay
It is conventional wisdom that a residential leasehold with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years ahead.
|Barclays plc||Mortgage term plus 25 years provided that leases of less than 85 years are be referred to us for approval.|
|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.|
|Lloyds TSB Scotland||Mortgage term plus 30 years subject to an overall minimum term of 70 years|
|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.
|Royal Bank of Scotland||Mortgage term plus 30 years. For a Lifetime Mortgage, the term must be no less than 150 years minus the age of the Borrower.|
The conveyancers that we work with procure Purley 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 negotiations with the landlord of her basement apartment in Purley, Alicia commenced the lease extension process just as her lease was coming close to the critical 80-year mark. The lease extension was finalised in February 2010. The landlord’s costs were negotiated to about six hundred pounds.
Last year we were phoned by Mr and Mrs. U Peterson , who acquired a one bedroom apartment in Purley in October 1997. The question was if we could shed any light on how much (approximately) compensation to the landlord could be to prolong the lease by 90 years. Comparable homes in Purley with a long lease were valued about £264,000. The average ground rent payable was £60 collected quarterly. The lease finished on 1 January 2074. Considering the 53 years as a residual term we approximated the compensation to the landlord for the lease extension to be within £37,100 and £42,800 plus expenses.
An example of a Freehold Enfranchisement case for a Purley flat is The Woodlands 95 Purley Park Road in April 2009. The Tribunals own valuation produced the figure of £37,912. This case affected 6 flats. The remaining number of years on the lease was 78.32 years.