The market value of a leasehold property in Silsoe depends on how many years the lease has remaining. If it is close to or less than eighty years you should anticipate difficulties on re-sale, so it is advisable to arrange for the lease to be extended prior to buying. Ideally one should start the process of extending the lease is when the lease still has 82 years to run so that a lease extension can be finalised well before the eighty year cut off point. Current legislation entitles Silsoe qualifying lessees to an additional term of ninety years on top of the unexpired term, at a peppercorn rent (zero ground rent). The reason of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold residencies in Silsoe with in excess of 100 years remaining on the lease are sometimes regarded as a ‘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 upside in buying the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | 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. |
| Godiva Mortgages | 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. |
The conveyancers that we work with undertake Silsoe 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 conveyancing solicitor we work with provide it.
Last Winter Edward, came perilously close to the 80-year mark with the lease on his basement flat in Silsoe. Having bought his flat two decades ago, the unexpired term was of minimal concern. Thankfully, he realised he would soon be paying an inflated amount for Extending the lease. Edward arranged for a lease extension just in the nick of time in January. Edward and the freeholder eventually settled on the final figure of £6,000 . If the lease had dropped to less than 80 years, the price would have increased by at least £1,050.
In 2012 we were approached by Mr Tommy Nelson who, having purchased a purpose-built apartment in Silsoe in January 2009. The dilemma was if we could approximate the price would be to prolong the lease by 90 years. Similar residencies in Silsoe with a long lease were in the region of £205,000. The mid-range ground rent payable was £50 collected per annum. The lease concluded in 2104. Having 79 years outstanding we calculated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 plus expenses.
Last October we were contacted by Dr Chantelle Nelson , who owned a newly refurbished flat in Silsoe in January 2006. We are asked if we could estimate the price could be for a ninety year extension to my lease. Comparable properties in Silsoe with a long lease were in the region of £275,000. The mid-range amount of ground rent was £65 billed annually. The lease termination date was on 14 February 2093. Given that there were 68 years left we calculated the compensation to the freeholder to extend the lease to be between £13,300 and £15,400 not including costs.