For those whose Shaftesbury property is held on a long lease, our message is clear – if you do nothing, your property will ultimately revert to your landlord, leaving you empty-handed. The shorter the lease the lower the value of the property and the more it will cost to extend the lease.
Leasehold premises in Shaftesbury with in excess of one hundred years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and estate charges merit it.
|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.|
|Birmingham Midshires|| Minimum 70 years from the date of the mortgage.|
|Chelsea 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.|
|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
|TSB||Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption.|
Regardless of whether you are a tenant or a landlord in Shaftesbury,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Shaftesbury valuers.
Last Christmas Ryan, came critically near to the 80-year mark with the lease on his studio apartment in Shaftesbury. Having purchased his flat 18 years previously, the unexpired term was of no relevance. Fortunately, he realised he needed to take action soon on a lease extension. Ryan was able to extend his lease just under the wire in April. Ryan and the landlord in the end agreed on a premium of £6,000 . If he had missed the deadline, the amount would have gone up by a minimum £1,025.
Ms M Mitchell acquired a first floor apartment in Shaftesbury in November 1996. The dilemma was if we could estimate the price could be to prolong the lease by a further 90 years. Comparative premises in Shaftesbury with a long lease were worth £295,000. The mid-range ground rent payable was £45 invoiced per annum. The lease lapsed in 2095. Having 74 years unexpired we approximated the compensation to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of fees.
Mrs Georgia Girard completed a recently refurbished flat in Shaftesbury in September 2008. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be for a 90 year extension to my lease. Similar flats in Shaftesbury with an extended lease were worth £243,000. The mid-range ground rent payable was £65 billed yearly. The lease ended in 2084. Given that there were 63 years remaining we calculated the premium to the freeholder to extend the lease to be between £20,000 and £23,000 not including costs.