Shrewsbury leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease becomes more expensive. It is the case that most Shrewsbury tenants have the right to extend their lease by an additional 90 years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in Shrewsbury you must investigate if your lease has between 70 and 90 years remaining. There are good reasons why a Shrewsbury flat owner with a lease having around eighty years left should take steps to ensure that a lease extension is actioned without delay
It is generally accepted that a property with over one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 30 years unexpired, the property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
Using our service will provide you enhanced control over the value of your Shrewsbury leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Lucas was the the leasehold proprietor of a conversion apartment in Shrewsbury on the market with a lease of a little over 61 years outstanding. Lucas on an informal basis spoke with his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £100 annually. No ground rent would be payable on a lease extension were Lucas to invoke his statutory right. Lucas procured expert legal guidance and was able to make a more informed decision and deal with the matter and ending up with a market value flat.
In 2013 we were e-mailed by Mr and Mrs. C Bertrand who, having took over the lease of a basement apartment in Shrewsbury in April 2011. We are asked if we could shed any light on how much (roughly) price would likely be for a 90 year lease extension. Identical premises in Shrewsbury with an extended lease were in the region of £250,400. The mid-range amount of ground rent was £65 collected monthly. The lease came to a finish in 2089. Given that there were 64 years left we estimated the premium to the landlord to extend the lease to be within £19,000 and £22,000 exclusive of fees.
Mr and Mrs. K King owned a one bedroom flat in Shrewsbury in July 1998. The question was if we could approximate the premium would likely be to extend the lease by a further 90 years. Comparative residencies in Shrewsbury with an extended lease were worth £189,000. The mid-range ground rent payable was £55 billed per annum. The lease end date was in 2078. Having 53 years left we calculated the compensation to the landlord for the lease extension to be within £28,500 and £33,000 exclusive of professional charges.