As the the remaining lease term of a St Werburghs domestic lease diminished so does its value and therefore the value of your property. If the residual term has, in excess of one hundred years remaining then this decrease may be fractional that being said there will become a point in time when a lease has less than 80 years left as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main reason why you should consider extending without delay. The majority of flat owners in St Werburghs will qualify for this right; that being said a lawyer can advise whether you qualify to extend your lease. In certain situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold residencies in St Werburghs with in excess of one hundred years outstanding on the lease are sometimes 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 to be gained by purchasing the freehold unless savings on ground rent and service charges justify 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Birmingham Midshires | 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 75 years plus the term of the mortgage at the outset of the mortgage. |
Retaining our service gives you increased control over the value of your St Werburghs leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to lengthy negotiations with the landlord of her first floor apartment in St Werburghs, Rebecca commenced the lease extension process as the 80 year threshold was fast nearing. The lease extension was finalised in January 2012. The freeholder’s charges were negotiated to less than 550 GBP.
Dr Ellen Scott moved into a ground floor apartment in St Werburghs in March 2011. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be to prolong the lease by a further 90 years. Identical homes in St Werburghs with 100 year plus lease were valued about £285,000. The mid-range ground rent payable was £45 invoiced monthly. The lease expired on 14 April 2098. Taking into account 72 years outstanding we estimated the compensation to the freeholder for the lease extension to be within £12,400 and £14,200 plus costs.
Dr Sarah Young bought a garden flat in St Werburghs in September 1995. The question was if we could approximate the premium could be to prolong the lease by ninety years. Identical homes in St Werburghs with 100 year plus lease were valued about £233,200. The mid-range ground rent payable was £60 collected quarterly. The lease termination date was on 28 March 2087. Considering the 61 years outstanding we estimated the compensation to the freeholder for the lease extension to be within £22,800 and £26,400 exclusive of fees.