With a residential leasehold premises in Sneinton, you are actually purchasing a right to reside in a property for a prescribed time frame. Modern flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you may think about a lease extension sooner rather than later. The general rule is that the shorter the number of years is the cost of extending the lease becomes disproportionately greater notably when there are fewer than eighty years remaining. Anyone in Sneinton with a lease drawing near to 81 years left should seriously think of extending it as soon as possible. When the lease term has under 80 years left, under the relevant Act the landlord is entitled to calculate and levy a larger amount, assessed on a technical computation, strangely termed as “marriage value” which is due.
It is generally accepted that a residential leasehold with more than 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years ahead.
| 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. |
| 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. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Sneinton,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 Sneinton valuers.
Aiden owned a conversion apartment in Sneinton being marketed with a lease of just over 72 years outstanding. Aiden informally contacted his freeholder a well known London-based freehold company for a lease extension. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £150 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Aiden to exercise his statutory right. Aiden procured expert advice and secured satisfactory deal without going to tribunal and ending up with a market value flat.
In 2014 we were called by Mr Jason Mitchell who, having took over the lease of a basement apartment in Sneinton in September 2000. We are asked if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Comparative residencies in Sneinton with a long lease were valued about £198,800. The average ground rent payable was £55 collected per annum. The lease elapsed in 2081. Given that there were 55 years as a residual term we estimated the compensation to the freeholder to extend the lease to be between £33,300 and £38,400 not including legals.
Dr O Thomas bought a one bedroom apartment in Sneinton in May 2005. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be for a ninety year lease extension. Identical properties in Sneinton with 100 year plus lease were valued around £295,000. The mid-range ground rent payable was £50 invoiced quarterly. The lease ended in 2101. Given that there were 75 years left we estimated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 plus legals.