With a domestic leasehold property in Shipston on Stour, you are actually purchasing an entitlement to live in a property for a set period of time. These days 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 as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease becomes disproportionately greater notably once there are less than 80 years remaining. Leasehold owners in Shipston on Stour with a lease nearing 81 years left should seriously think of extending it sooner than later. When a lease has below eighty years remaining, under the current statute the landlord is entitled to calculate and charge a greater premium, assessed on a technical multiplication, known as “marriage value” which is due.
Leasehold properties in Shipston on Stour with over one hundred years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Irrespective of whether you are a tenant or a landlord in Shipston on Stour,the lease extension experts 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 Shipston on Stour valuers.
Edward owned a 2 bedroom flat in Shipston on Stour on the market with a lease of fraction over sixty years outstanding. Edward on an informal basis contacted his freeholder a well known London-based freehold company for a lease extension. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £200 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Edward to exercise his statutory right. Edward obtained expert advice and was able to make an informed judgement and handle with the matter and ending up with a market value flat.
Last Spring we were phoned by Mr J Cook , who was assigned a lease of a purpose-built flat in Shipston on Stour in June 2012. We are asked if we could shed any light on how much (roughly) premium would likely be to extend the lease by ninety years. Similar flats in Shipston on Stour with a long lease were valued around £184,000. The mid-range amount of ground rent was £55 collected annually. The lease lapsed in 2079. Considering the 53 years left we calculated the compensation to the landlord for the lease extension to be within £28,500 and £33,000 exclusive of fees.
Last month we were called by Mrs Ella Ali , who completed a recently refurbished flat in Shipston on Stour in February 2009. The question was if we could approximate the premium would be to prolong the lease by an additional years. Similar flats in Shipston on Stour with a long lease were in the region of £290,000. The mid-range amount of ground rent was £45 invoiced annually. The lease ended in 2099. Given that there were 73 years outstanding we estimated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of professional charges.