The closer a residential lease in Ryde gets to zero years unexpired, the the greater the reduction in the value of the property. If the residual term has, more than 125 years remaining then this decrease may be fractional that being said there will become a point in time when a lease has fewer than 80 years unexpired as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the main reason why you should extend the lease sooner rather than later. Many flat owners in Ryde will meet the qualifying criteria; nevertheless a conveyancer will be able to confirm if you qualify for a lease extension. In limited situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold premises in Ryde with more than one hundred years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| Yorkshire 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. |
Engaging our service will provide you better control over the value of your Ryde leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Aarav owned a conversion flat in Ryde being marketed with a lease of just over sixty years remaining. Aarav informally contacted his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £125 per annum. Ordinarily, ground rent would not be due on a lease extension were Aarav to exercise his statutory right. Aarav obtained expert advice and secured an acceptable deal informally and readily saleable.
Last Autumn we were contacted by Mr Joseph Moore , who took over the lease of a garden flat in Ryde in February 2000. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to extend the lease by ninety years. Comparable homes in Ryde with 100 year plus lease were in the region of £256,600. The average ground rent payable was £60 collected annually. The lease lapsed in 2077. Taking into account 52 years left we calculated the compensation to the freeholder to extend the lease to be between £39,000 and £45,000 not including legals.
In 2009 we were approached by Mrs G Reed who, having was assigned a lease of a garden flat in Ryde in January 2008. We are asked if we could estimate the premium would be for a 90 year lease extension. Comparative homes in Ryde with 100 year plus lease were valued around £218,000. The mid-range ground rent payable was £45 collected annually. The lease end date was in 2088. Having 63 years unexpired we estimated the premium to the landlord for the lease extension to be within £17,100 and £19,800 not including professional charges.