For those whose Rubery property is held on a long lease, the message is clear – if you do nothing, your property will ultimately revert to your landlord, leaving you empty-handed. The shorter the lease the less it is worth and the more expensive it will be to obtain a lease extension.
It is conventional wisdom that a residential leasehold with over one hundred years remaining is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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 75 years plus the term of the mortgage at the outset of the mortgage. |
| 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 |
Regardless of whether you are a tenant or a freeholder in Rubery,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Rubery valuers.
Following lengthy discussions with the landlord of her ground floor apartment in Rubery, Katie commenced the lease extension process just as the lease was nearing the crucial eighty-year mark. The legal work was finalised in August 2014. The landlord’s charges were kept to an absolute minimum.
Mr Alfie Ricardo acquired a ground floor flat in Rubery in September 2008. The question was if we could estimate the premium would be for a 90 year extension to my lease. Similar premises in Rubery with an extended lease were valued about £240,600. The mid-range ground rent payable was £60 invoiced yearly. The lease expiry date was on 28 February 2088. Considering the 62 years remaining we estimated the premium to the landlord to extend the lease to be within £21,900 and £25,200 exclusive of expenses.
In 2014 we were contacted by Dr U Adams who, having bought a one bedroom apartment in Rubery in February 1998. We are asked if we could approximate the premium could be to prolong the lease by a further 90 years. Comparable flats in Rubery with 100 year plus lease were valued about £174,200. The mid-range ground rent payable was £55 billed per annum. The lease ran out on 13 September 2077. Considering the 51 years as a residual term we estimated the premium to the freeholder for the lease extension to be within £31,400 and £36,200 exclusive of expenses.