Unfortunately that a Romsey residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Romsey property prices.Where your lease has approximately 90 years left, you need to start considering a lease extension. If the number of years remaining dips below 80 years, you will end up paying 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of leasehold owners in Romsey will be able to extend under the legislation; however a lawyer should be able to confirm if you qualify for an extension. In some cases you may not qualify. There are also strict deadlines and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancing solicitor for the duration of the formalities.
Leasehold properties in Romsey with more than 100 years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Coventry Building Society | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
The conveyancing solicitors that we work with undertake Romsey 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 conveyancing solicitor we work with provide it.
Last Autumn David, started to get close to the eighty-year mark with the lease on his ground floor apartment in Romsey. Having purchased his flat two decades ago, the length of the lease was of no interest. Fortunately, he realised he would imminently be paying an inflated amount for a lease extension. David extended the lease just ahead of time in April. David and the freeholder via the management company subsequently settled on a premium of £6,000 . If he had missed the deadline, the sum would have become more costly by at least £1,100.
Last Christmas we were e-mailed by Mr E Torres , who completed a one bedroom flat in Romsey in February 2002. We are asked if we could shed any light on how much (approximately) premium could be to prolong the lease by 90 years. Comparative premises in Romsey with 100 year plus lease were valued around £218,000. The mid-range amount of ground rent was £45 collected per annum. The lease ended in 2089. Having 63 years unexpired we approximated the compensation to the freeholder for the lease extension to be between £17,100 and £19,800 plus professional charges.
Last month we were e-mailed by Mr and Mrs. N André , who was assigned a lease of a basement flat in Romsey in October 1996. We are asked if we could estimate the compensation to the landlord would be for a 90 year extension to my lease. Similar premises in Romsey with an extended lease were worth £265,000. The mid-range ground rent payable was £55 billed every twelve months. The lease lapsed in 2100. Given that there were 74 years left we estimated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 plus professional charges.