Shinfield Lease Extension - Free Consultation

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Why you should commence your Shinfield lease extension

Main reasons to commence your Shinfield lease extension today:

Increase your lease and increase your Shinfield property value

With a long leasehold premises in Shinfield, you effectively rent it for a certain amount of time. Modern flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you should think about extending the lease sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease increases markedly particularly when there are less than 80 years remaining. Residents in Shinfield with a lease approaching 81 years left should seriously consider extending it as soon as possible. When the lease term has under eighty years remaining, under the current legislation the landlord can calculate and demand a greater premium, based on a technical calculation, known as “marriage value” which is due.

Shinfield property with a lease extension has roughly the same value as a freehold

It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 45 years unexpired, the property will be worth the same as a freehold for many years ahead.

Lending institutions may decide not to loan monies on a short lease

Mortgage companies do not like short residential leases. You are likely to encounter difficulties if you want to sell your flat in Shinfield if the unexpired lease term is less than the criteria set by the majority of lenders. Different lenders have different requirements but on the whole theyrequire an unexpired term of at least seventy years.

Lender Requirement
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;
Leeds Building Society 85 years remaining from the start 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
TSB Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption.
Royal Bank of Scotland Mortgage term plus 30 years.

Get in touch with one of our Shinfield lease extension solicitors or enfranchisement solicitors

Regardless of whether you are a tenant or a freeholder in Shinfield,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Shinfield valuers.

Shinfield Lease Extension Case Studies:

Benjamin, Shinfield, Berkshire

Last Christmas Benjamin, started to get near to the 80-year threshold with the lease on his one bedroom flat in Shinfield. Having purchased his flat twenty years previously, the length of the lease was of minimal significance. Fortunately, it dawned on him that he would imminently be paying an inflated amount for a lease extension. Benjamin extended the lease at the eleventh hour last January. Benjamin and the landlord who owned the flat above subsequently settled on an amount of £5,000 . If the lease had fallen to less than eighty years, the amount would have become more exhorbitant by a minimum £900.

Shinfield case:

In 2014 we were e-mailed by Dr U Gómez who, having bought a purpose-built flat in Shinfield in March 1998. We are asked if we could estimate the price could be for a 90 year lease extension. Identical properties in Shinfield with a long lease were valued around £270,000. The mid-range ground rent payable was £55 invoiced every twelve months. The lease terminated in 2100. Taking into account 76 years remaining we calculated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 plus costs.

Shinfield case:

Ms H Jackson acquired a basement flat in Shinfield in May 1996. We are asked if we could approximate the premium would be for a ninety year lease extension. Comparative properties in Shinfield with an extended lease were worth £176,200. The mid-range ground rent payable was £65 invoiced yearly. The lease termination date was on 21 June 2080. Given that there were 56 years left we approximated the compensation to the freeholder to extend the lease to be within £29,500 and £34,000 plus legals.