There is no doubt about it a leasehold flat or house in Redcar is a wasting asset as a result of the shortening lease. Where the residual term has, more than one hundred years remaining then this decrease may be fractional that being said there will become a stage when a lease has fewer than eighty years remaining as part of the premium you will incur is what is known as a marriage value. This could increase sharply the cost. It is the primary reason why you should extend the lease sooner than later. The majority of flat owners in Redcar will qualify for this right; however a conveyancer can advise whether you qualify for a lease extension. In limited situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
Leasehold premises in Redcar with in excess of one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
Using our service gives you enhanced control over the value of your Redcar leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
In the wake of eight months of lengthy correspondence with the landlord of her studio apartment in Redcar, Morgan started the lease extension process as the eighty year threshold was quickly nearing. The legal work was concluded in May 2008. The landlord’s fees were restricted to slightly above 700 pounds.
Last year we were approach by Dr L Phillips , who owned a studio flat in Redcar in August 2000. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would be to prolong the lease by ninety years. Similar properties in Redcar with 100 year plus lease were in the region of £245,000. The average ground rent payable was £45 billed quarterly. The lease expired in 2094. Having 68 years as a residual term we estimated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 plus professional charges.
In 2009 we were approached by Mr and Mrs. P Simon who, having took over the lease of a basement apartment in Redcar in November 1999. The question was if we could shed any light on how much (roughly) compensation to the landlord would likely be for a 90 year lease extension. Similar premises in Redcar with an extended lease were in the region of £280,000. The average amount of ground rent was £55 invoiced per annum. The lease end date was in 2105. Having 79 years unexpired we calculated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 plus legals.