On the balance of probabilities where you own a flat in Stilton you actually own a long leasehold interest over your property
It is generally accepted that a residential leasehold with over one hundred years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 30 years remaining, the premises will be equivalent in value to a freehold for decades to come.
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with handle Stilton 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 lawyer we work with provide it.
In the wake of 9 months of protracted correspondence with the freeholder of her basement flat in Stilton, Elizabeth initiated the lease extension process as the eighty year deadline was swiftly nearing. The legal work was finalised in March 2015. The freeholder’s costs were kept to an absolute minimum.
Dr A Gómez moved into a one bedroom apartment in Stilton in November 1999. We are asked if we could shed any light on how much (roughly) premium would likely be for a 90 year lease extension. Similar residencies in Stilton with 100 year plus lease were valued around £191,000. The mid-range amount of ground rent was £65 billed annually. The lease terminated on 22 August 2084. Having 58 years remaining we calculated the premium to the freeholder to extend the lease to be between £23,800 and £27,400 not including professional charges.
In 2014 we were contacted by Dr V Lefèvre who, having acquired a first floor flat in Stilton in April 1997. The question was if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Identical properties in Stilton with a long lease were valued about £250,000. The average amount of ground rent was £50 billed annually. The lease expired on 14 April 2095. Given that there were 69 years outstanding we estimated the premium to the landlord to extend the lease to be between £9,500 and £11,000 plus fees.