Rayleigh leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Legislation has been in place for sometime now which entitles qualifying Rayleigh residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Rayleigh you really ought to check if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under eighty years, the amount payable for any lease extension increases dramatically as part of the premium you pay is what is known as a marriage value
Leasehold properties in Rayleigh with in excess of 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Chelsea 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Lease extensions in Rayleigh can be a difficult process. We recommend you get guidance from a lawyer and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring Rayleigh lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Arthur owned a conversion apartment in Rayleigh on the market with a lease of just over sixty years remaining. Arthur informally approached his landlord being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £100 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Arthur to exercise his statutory right. Arthur procured expert legal guidance and secured satisfactory resolution without resorting to tribunal and ending up with a market value flat.
In 2014 we were e-mailed by Mrs Danielle Hall who, having owned a one bedroom apartment in Rayleigh in September 2005. The question was if we could estimate the premium would likely be for a 90 year lease extension. Comparable homes in Rayleigh with an extended lease were in the region of £223,400. The mid-range amount of ground rent was £60 invoiced yearly. The lease elapsed in 2085. Given that there were 59 years as a residual term we approximated the compensation to the freeholder for the lease extension to be between £27,600 and £31,800 exclusive of expenses.
Mrs C Clark bought a basement apartment in Rayleigh in February 2009. The question was if we could shed any light on how much (approximately) price would be for a 90 year extension to my lease. Identical flats in Rayleigh with an extended lease were valued around £205,000. The mid-range amount of ground rent was £50 collected monthly. The lease expired on 10 August 2105. Given that there were 79 years left we calculated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 plus legals.