Unfortunately that a St Neots residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the St Neots property prices.Where your lease has approximately 90 years left, you need to start thinking about a lease extension. If the number of years remaining falls under eighty years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property The majority of leasehold owners in St Neots will be able to extend under the legislation; however a lawyer should be able to confirm whether you qualify for an extension. In some situations you may not qualify. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer for the duration of the formalities.
Leasehold residencies in St Neots with in excess of one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Regardless of whether you are a tenant or a freeholder in St Neots,the lease extension lawyers 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 St Neots valuers.
In recent months Harry, started to get near to the eighty-year mark with the lease on his basement apartment in St Neots. In buying his flat 19 years ago, the length of the lease was of no relevance. As luck would have it, it dawned on him that he needed to take action soon on a lease extension. Harry arranged for a lease extension at the eleventh hour in August. Harry and the freeholder in the end settled on an amount of £5,500 . If the lease had descended lower than eighty years, the price would have escalated by at least £1,150.
Mr Zachary Lefèvre purchased a studio flat in St Neots in March 1999. The dilemma was if we could estimate the price could be to extend the lease by 90 years. Comparable residencies in St Neots with a long lease were worth £264,000. The average ground rent payable was £60 invoiced per annum. The lease ran out in 2078. Taking into account 53 years unexpired we calculated the premium to the landlord for the lease extension to be between £37,100 and £42,800 exclusive of costs.
In 2011 we were approached by Mr K Díaz who, having took over the lease of a purpose-built flat in St Neots in April 1999. We are asked if we could approximate the price would likely be to prolong the lease by a further 90 years. Comparable flats in St Neots with 100 year plus lease were worth £225,400. The mid-range ground rent payable was £45 invoiced annually. The lease terminated in 2089. Having 64 years outstanding we approximated the compensation to the landlord for the lease extension to be between £15,200 and £17,600 not including costs.