It’s an underpublicised certainty that a Redditch residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Redditch property market.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips lower than 80 years - otherwise a higher premium will be payable. Most flat owners in Redditch will be able to extend under the legislation; however a conveyancer will be able to clarify whether you qualify for an extension. In some cases you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer for the duration of the formalities.
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with handle Redditch 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 lawyer we work with provide it.
Following protracted discussions with the freeholder of her first floor flat in Redditch, Georgia started the lease extension process as the eighty year deadline was rapidly nearing. The transaction completed in January 2006. The freeholder’s fees were restricted to less than five hundred GBP.
Last September we were contacted by Mrs D Baker , who owned a basement apartment in Redditch in June 2012. The question was if we could shed any light on how much (roughly) price could be to extend the lease by 90 years. Identical premises in Redditch with 100 year plus lease were worth £260,200. The mid-range ground rent payable was £65 billed every twelve months. The lease terminated in 2092. Having 66 years left we approximated the premium to the landlord to extend the lease to be within £14,300 and £16,400 plus legals.
Ms Rebecca Ramírez purchased a purpose-built apartment in Redditch in January 1998. The dilemma was if we could approximate the price would be to extend the lease by an additional years. Similar flats in Redditch with an extended lease were worth £198,800. The average amount of ground rent was £55 invoiced annually. The lease came to a finish on 13 November 2081. Taking into account 55 years outstanding we estimated the premium to the landlord for the lease extension to be between £33,300 and £38,400 plus professional charges.