Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will ordinarily be granted for a fixed period of time , usually 99 or 125 years, although we have come across longer and shorter terms in Shoeburyness. Clearly, the term of lease remaining reduces over time. This is often ignored and only raises itself as an issue when the flat or house has to be disposed of or refinanced. The fewer the years remaining the less it is worth and the more expensive it will be to extend the lease. Eligible long lease owners in Shoeburyness have the right to extend the lease for a further 90 years under Leasehold Reform legislation. You should give careful attention before delaying your Shoeburyness lease extension. Putting off the cost now only increases the price you will eventually have to pay to extend your lease
It is conventional wisdom that a property with in excess of 100 years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 35 years unexpired, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| 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; |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
Irrespective of whether you are a tenant or a landlord in Shoeburyness,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Shoeburyness valuers.
Last October Alexander, started to get close to the 80-year threshold with the lease on his ground floor flat in Shoeburyness. Having purchased his flat two decades ago, the unexpired term was of no concern. by good luck, he noticed he needed to take steps soon on a lease extension. Alexander arranged for a lease extension just under the wire in May. Alexander and the freeholder subsequently settled on the final figure of £5,500 . If the lease had slid below 80 years, the amount would have escalated by a minimum £1,075.
Mr Alexander Harris moved into a one bedroom apartment in Shoeburyness in January 2003. The dilemma was if we could estimate the premium would likely be for a 90 year extension to my lease. Similar properties in Shoeburyness with an extended lease were in the region of £198,800. The average amount of ground rent was £55 invoiced annually. The lease terminated in 2080. Taking into account 55 years remaining we estimated the compensation to the freeholder for the lease extension to be within £33,300 and £38,400 not including legals.
Last Winter we were contacted by Mr and Mrs. I Williams , who moved into a garden apartment in Shoeburyness in January 1999. We are asked if we could shed any light on how much (approximately) price would likely be for a ninety year extension to my lease. Similar properties in Shoeburyness with an extended lease were worth £300,000. The mid-range ground rent payable was £50 invoiced monthly. The lease termination date was on 28 April 2100. Having 75 years remaining we calculated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 not including expenses.