When it comes to long leasehold premises in Reading, you are actually buying a right to reside in a property for a prescribed time frame. These days flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you may think about extending the lease sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease increases markedly particularly when there are fewer than 80 years left. Leasehold owners in Reading with a lease nearing 81 years remaining should seriously think of extending it as soon as possible. When a lease has below 80 years left, under the relevant legislation the freeholder is entitled to calculate and charge a larger premium, based on a technical calculation, known as “marriage value” which is payable.
Leasehold premises in Reading with in excess of one hundred years unexpired on the lease are sometimes referred to as ‘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 purchasing the freehold unless savings on ground rent and service charges merit 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Lease extensions in Reading can be a difficult process. We recommend you secure professional help 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 Reading lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Omar was the the leasehold proprietor of a conversion flat in Reading on the market with a lease of a little over 72 years unexpired. Omar on an informal basis spoke with his landlord being a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of an increased rent to £100 annually. Ordinarily, ground rent would not be due on a lease extension were Omar to invoke his statutory right. Omar obtained expert advice and was able to make an informed judgement and deal with the matter and sell the flat.
Last Summer we were called by Dr F Morgan , who bought a ground floor apartment in Reading in May 2009. We are asked if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Identical residencies in Reading with an extended lease were in the region of £267,600. The mid-range amount of ground rent was £65 billed every twelve months. The lease ran out on 17 November 2093. Having 67 years remaining we estimated the premium to the freeholder for the lease extension to be between £14,300 and £16,400 exclusive of legals.
Last Autumn we were approach by Mr Sam Phillips , who was assigned a lease of a one bedroom flat in Reading in January 1997. The dilemma was if we could estimate the price could be for a ninety year lease extension. Comparative premises in Reading with 100 year plus lease were valued around £206,200. The average ground rent payable was £55 invoiced monthly. The lease lapsed in 2082. Having 56 years as a residual term we approximated the compensation to the freeholder for the lease extension to be between £31,400 and £36,200 not including legals.