With a long leasehold premises in Selston, you are actually purchasing an entitlement to reside in a property for a prescribed time frame. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you may think about extending the lease sooner rather than later. The general rule is that the shorter the number of years is the cost of extending the lease becomes disproportionately greater particularly when there are fewer than eighty years left. Residents in Selston with a lease nearing 81 years left should seriously think of extending it without delay. When a lease has fewer than 80 years remaining, under the relevant legislation the landlord is entitled to calculate and levy a greater amount, based on a technical multiplication, strangely termed as “marriage value” which is due.
It is generally considered that a residential leasehold with more than one hundred years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 35 years remaining, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
The conveyancers that we work with procure Selston 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 conveyancer we work with provide it.
Last year Toby, started to get near to the eighty-year mark with the lease on his basement flat in Selston. In buying his home 18 years previously, the unexpired term was of minimal importance. Luckily, he noticed he needed to take action soon on a lease extension. Toby was able to extend his lease just under the wire in July. Toby and the landlord who owned the flat above subsequently settled on a premium of £5,000 . If the lease had dipped lower than eighty years, the figure would have become more exhorbitant by a minimum £925.
In 2010 we were called by Dr V García who, having acquired a ground floor flat in Selston in October 2002. We are asked if we could shed any light on how much (approximately) premium would likely be for a ninety year extension to my lease. Similar flats in Selston with an extended lease were valued around £250,400. The average amount of ground rent was £65 billed annually. The lease terminated in 2089. Having 64 years outstanding we approximated the premium to the landlord for the lease extension to be between £19,000 and £22,000 plus costs.
Last November we were contacted by Dr R Collins , who took over the lease of a recently refurbished apartment in Selston in October 1998. We are asked if we could estimate the premium would be to extend the lease by ninety years. Comparable homes in Selston with an extended lease were in the region of £189,000. The mid-range ground rent payable was £55 collected yearly. The lease finished on 1 October 2078. Given that there were 53 years outstanding we approximated the premium to the freeholder to extend the lease to be between £28,500 and £33,000 plus legals.