As the length of the unexpired term of a Raglan domestic lease lessens so does its value and therefore the value of your property. Where the lease has, over 125 years remaining then this decrease may be of little impact nevertheless there will become a point in time when a lease has fewer than eighty years left as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the main reason why you should extend the lease sooner as opposed to later. Many flat owners in Raglan will qualify for this right; that being said a conveyancing solicitor can advise whether you qualify for a lease extension. In certain situations you may not qualify, the most common reason being that you have owned the property for less than two years.
Leasehold premises in Raglan with over 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 Raglan 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 conveyancing solicitor we work with provide it.
Alex owned a high value apartment in Raglan on the market with a lease of fraction over 72 years outstanding. Alex informally spoke with his freeholder a well known Manchester-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a rise in the rent to £200 per annum. No ground rent would be due on a lease extension were Alex to invoke his statutory right. Alex procured expert legal guidance and secured an acceptable deal informally and readily saleable.
Mrs G Harris acquired a one bedroom flat in Raglan in August 2010. The dilemma was if we could shed any light on how much (roughly) premium could be for a ninety year extension to my lease. Comparative residencies in Raglan with 100 year plus lease were worth £227,800. The mid-range amount of ground rent was £45 billed yearly. The lease end date was in 2090. Taking into account 65 years remaining we approximated the compensation to the freeholder to extend the lease to be between £13,300 and £15,400 exclusive of professional charges.
In 2011 we were e-mailed by Dr Stanley Lambert who, having bought a purpose-built flat in Raglan in May 2001. We are asked if we could shed any light on how much (approximately) price could be to prolong the lease by 90 years. Comparative residencies in Raglan with an extended lease were worth £275,000. The average ground rent payable was £55 invoiced yearly. The lease expired on 5 May 2101. Given that there were 76 years remaining we estimated the premium to the landlord for the lease extension to be between £9,500 and £11,000 exclusive of costs.