Shrewton leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. Legislation has been in place for sometime now which entitles qualifying Shrewton residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Shrewton you should investigate if your lease has between seventy and ninety years remaining. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension increases dramatically as an element of the premium you pay is what is known as a marriage value
It is generally considered that a property with more than one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence 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. |
| 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. |
| Halifax | 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 30 years plus the term of the mortgage at the outset 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 |
Using our service will provide you enhanced control over the value of your Shrewton leasehold, as your property will be more valuable and saleable in respect of lease length should you wish to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Hunter owned a 2 bedroom flat in Shrewton on the market with a lease of a few days over fifty eight years outstanding. Hunter on an informal basis contacted his landlord being a well known Manchester-based freehold company for a lease extension. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £125 yearly. No ground rent would be due on a lease extension were Hunter to invoke his statutory right. Hunter obtained expert legal guidance and secured satisfactory resolution without going to tribunal and sell the property.
In 2013 we were approached by Dr Samantha Moore who, having owned a one bedroom flat in Shrewton in June 2005. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be to prolong the lease by ninety years. Comparable premises in Shrewton with 100 year plus lease were worth £196,400. The average amount of ground rent was £55 billed per annum. The lease ran out in 2080. Taking into account 54 years as a residual term we approximated the premium to the landlord for the lease extension to be within £34,200 and £39,600 plus fees.
Last Autumn we were contacted by Mr N Morgan , who acquired a ground floor flat in Shrewton in March 2003. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord could be to extend the lease by 90 years. Comparable homes in Shrewton with 100 year plus lease were valued about £295,000. The mid-range ground rent payable was £45 billed every twelve months. The lease terminated on 15 August 2101. Considering the 75 years as a residual term we approximated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 exclusive of costs.