As the the remaining lease term of a Redruth domestic lease decreases so does its value and therefore the value of your property. Where the lease has, over 100 years to run then this decrease may be fractional nevertheless there will become a stage when a lease has less than 80 years unexpired as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main logic behind why you should extend the lease without delay. Most flat owners in Redruth will qualify for this right; nevertheless a conveyancing solicitor should be able to confirm if you qualify for a lease extension. In certain situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
Leasehold properties in Redruth with in excess of one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with handle Redruth 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.
Last year Edward, started to get near to the 80-year mark with the lease on his studio flat in Redruth. Having bought his property 18 years ago, the lease term was of little concern. As luck would have it, he noticed he would imminently be paying way over the odds for a lease extension. Edward extended the lease just under the wire last June. Edward and the freeholder subsequently settled on the final figure of £5,000 . If the lease had descended to less than eighty years, the price would have escalated by at least £975.
Last Autumn we were approach by Mrs H Gómez , who was assigned a lease of a first floor apartment in Redruth in June 2008. The question was if we could approximate the premium could be for a ninety year lease extension. Comparative homes in Redruth with 100 year plus lease were worth £250,400. The average amount of ground rent was £65 billed annually. The lease expiry date was in 2089. Considering the 64 years left we approximated the compensation to the landlord to extend the lease to be within £19,000 and £22,000 plus costs.
Last Autumn we were contacted by Mr and Mrs. B Edwards , who purchased a garden flat in Redruth in February 1996. The question was if we could shed any light on how much (approximately) price would likely be for a ninety year lease extension. Comparative properties in Redruth with 100 year plus lease were in the region of £184,000. The average amount of ground rent was £55 invoiced quarterly. The lease terminated in 2078. Considering the 53 years left we approximated the premium to the freeholder for the lease extension to be between £28,500 and £33,000 not including costs.