Ramsey leases on residential properties are gradually diminishing in 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 allowing qualifying Ramsey residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Ramsey you really ought to investigate if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under 80 years, the cost of any lease extension sharply increases as an element of the premium you will incur is what is known as a marriage value
Leasehold residencies in Ramsey with in excess of one hundred years outstanding on the lease are often regarded as a ‘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 upside in buying the reversionary interest unless savings on ground rent and estate charges justify it.
| 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with procure Ramsey 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 conveyancer we work with provide it.
Tommy owned a 2 bedroom apartment in Ramsey on the market with a lease of a little over 59 years remaining. Tommy on an informal basis approached his landlord a well known local-based freehold company for a lease extension. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £125 yearly. Ordinarily, ground rent would not be due on a lease extension were Tommy to invoke his statutory right. Tommy obtained expert legal guidance and secured an acceptable resolution informally and sell the flat.
In 2013 we were e-mailed by Mrs Grace Ramírez who, having completed a one bedroom apartment in Ramsey in November 1998. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord would be to extend the lease by ninety years. Identical residencies in Ramsey with an extended lease were valued about £295,000. The mid-range ground rent payable was £45 invoiced annually. The lease ran out on 15 January 2099. Taking into account 74 years unexpired we calculated the compensation to the landlord for the lease extension to be within £8,600 and £9,800 exclusive of professional charges.
Mr Toby Garcia took over the lease of a garden apartment in Ramsey in November 2002. We are asked if we could approximate the premium would be for a 90 year lease extension. Similar flats in Ramsey with 100 year plus lease were worth £248,000. The mid-range ground rent payable was £65 invoiced per annum. The lease elapsed in 2088. Considering the 63 years as a residual term we approximated the premium to the landlord for the lease extension to be within £20,900 and £24,200 not including legals.