When it comes to residential leasehold property in Ravensthorpe, you are actually buying a right to reside in a property for a prescribed time frame. Modern flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you should consider extending the lease sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly particularly when there are less than eighty years remaining. Residents in Ravensthorpe with a lease approaching 81 years remaining should seriously think of extending it as soon as possible. Once a lease has under 80 years left, under the relevant statute the freeholder is entitled to calculate and demand a greater amount, based on a technical calculation, strangely termed as “marriage value” which is due.
It is generally accepted that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 35 years left, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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. |
| Birmingham Midshires | Minimum 70 years from the date 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. |
| Yorkshire 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. |
Retaining our service will provide you increased control over the value of your Ravensthorpe leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
14 months ago Finn, came very near to the eighty-year threshold with the lease on his garden apartment in Ravensthorpe. Having purchased his flat two decades ago, the length of the lease was of no bearing. by good luck, he realised he needed to take action soon on a lease extension. Finn extended the lease at the eleventh hour last September. Finn and the freeholder eventually agreed on sum of £6,000 . If he had missed the deadline, the price would have gone up by a minimum £950.
In 2011 we were e-mailed by Mrs Y Allen who, having completed a ground floor flat in Ravensthorpe in June 1995. We are asked if we could estimate the price would likely be for a ninety year extension to my lease. Comparable flats in Ravensthorpe with a long lease were worth £210,000. The mid-range ground rent payable was £50 invoiced yearly. The lease came to a finish on 6 January 2105. Considering the 80 years left we estimated the premium to the landlord to extend the lease to be between £8,600 and £9,800 plus legals.
Dr N Hill moved into a garden apartment in Ravensthorpe in May 2002. The question was if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Similar flats in Ravensthorpe with a long lease were in the region of £280,000. The average amount of ground rent was £45 billed every twelve months. The lease came to a finish on 11 May 2094. Given that there were 69 years left we calculated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 exclusive of costs.