Silverton leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Silverton residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Silverton you should check if your lease has between seventy and 90 years left. In particular once the remaining lease term slips under eighty years, the amount payable for any lease extension sharply increases as part of the premium you pay is what is known as a marriage value
Leasehold residencies in Silverton with over one hundred years outstanding 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 upside in purchasing the freehold unless savings on ground rent and service charges justify 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. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| 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 |
Regardless of whether you are a tenant or a freeholder in Silverton,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Silverton valuers.
Samuel owned a high value apartment in Silverton on the market with a lease of just over 59 years unexpired. Samuel on an informal basis spoke with his freeholder a well known London-based freehold company for a lease extension. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £150 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Samuel to invoke his statutory right. Samuel procured expert legal guidance and secured satisfactory deal without resorting to tribunal and readily saleable.
In 2012 we were e-mailed by Mrs D Díaz who, having moved into a purpose-built apartment in Silverton in February 1995. We are asked if we could approximate the price could be to extend the lease by an additional years. Identical homes in Silverton with 100 year plus lease were in the region of £233,200. The average amount of ground rent was £60 invoiced monthly. The lease expiry date was on 5 July 2086. Having 61 years unexpired we calculated the compensation to the landlord to extend the lease to be between £22,800 and £26,400 exclusive of legals.
In 2013 we were phoned by Ms L Howard who, having completed a one bedroom flat in Silverton in April 2005. We are asked if we could estimate the price would be for a 90 year lease extension. Similar homes in Silverton with 100 year plus lease were worth £166,800. The average amount of ground rent was £50 billed quarterly. The lease ran out in 2075. Having 50 years unexpired we calculated the premium to the freeholder to extend the lease to be within £32,300 and £37,400 exclusive of professional charges.