Romsley leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. It is the case that most Romsley tenants have the right to extend their lease by an additional 90 years in accordance with the 1993 Leasehold Reform Act. If you are a leasehold owner in Romsley you really ought to see if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension increases dramatically as part of the premium you will incur is what is known as a marriage value
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| 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 |
Irrespective of whether you are a tenant or a landlord in Romsley,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Romsley valuers.
After lengthy negotiations with the landlord of her one bedroom flat in Romsley, Alisha initiated the lease extension process just as her lease was nearing the all-important 80-year deadline. The transaction was finalised in August 2015. The landlord’s costs were negotiated to less than 450 GBP.
Ms Rebecca Simon took over the lease of a one bedroom flat in Romsley in October 1998. The dilemma was if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Comparable flats in Romsley with a long lease were in the region of £275,000. The mid-range amount of ground rent was £55 invoiced per annum. The lease terminated in 2102. Having 76 years as a residual term we approximated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of professional charges.
Mr Blake Young was assigned a lease of a first floor flat in Romsley in June 2002. The question was if we could approximate the compensation to the landlord would likely be for a ninety year extension to my lease. Comparable properties in Romsley with an extended lease were worth £176,200. The average amount of ground rent was £65 collected annually. The lease concluded in 2082. Given that there were 56 years as a residual term we calculated the premium to the freeholder to extend the lease to be within £29,500 and £34,000 not including expenses.