It’s a harsh certainty that a Shipley residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the Shipley property prices.Where your lease has approximately 90 years left, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips lower than eighty years - otherwise a higher amount will be due. The majority of flat owners in Shipley will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm if you qualify for an extension. In some situations you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the process.
It is generally considered that a residential leasehold with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | 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. |
| Coventry Building Society | 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
The lawyers that we work with undertake Shipley 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.
Off the back of protracted discussions with the freeholder of her purpose-built flat in Shipley, Caitlin started the lease extension process just as her lease was nearing the crucial eighty-year threshold. The lease extension completed in October 2012. The landlord’s fees were restricted to under 700 GBP.
Mr W Allen took over the lease of a garden apartment in Shipley in March 2005. The dilemma was if we could approximate the premium would be to prolong the lease by 90 years. Comparable residencies in Shipley with a long lease were valued around £181,600. The average ground rent payable was £55 collected every twelve months. The lease ended in 2078. Considering the 52 years remaining we estimated the compensation to the landlord for the lease extension to be within £30,400 and £35,200 not including costs.
In 2011 we were called by Mr C Pérez who, having owned a one bedroom flat in Shipley in July 2012. We are asked if we could approximate the price could be for a ninety year extension to my lease. Identical homes in Shipley with an extended lease were valued around £285,000. The mid-range ground rent payable was £45 invoiced yearly. The lease ended in 2098. Considering the 72 years unexpired we calculated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 exclusive of costs.