There is no doubt about it a leasehold flat or house in Stourbridge is a wasting asset as a result of the diminishing lease term. If the lease has, in excess of 99 years remaining then this decrease may be negligible nevertheless 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 increase sharply the cost. It is the main reason why you should consider extending without delay. The majority of flat owners in Stourbridge will qualify for this right; however a conveyancing solicitor will be able to advise if you are eligible for a lease extension. In certain situations you may not qualify, the most common reason being that you have owned the property for under two years.
It is generally accepted that a residential leasehold with over one hundred years remaining is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 45 years left, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with procure Stourbridge 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 conveyancer we work with provide it.
Half a year ago David, came very near to the eighty-year mark with the lease on his one bedroom flat in Stourbridge. In buying his home two decades ago, the unexpired term was of little concern. Thankfully, he became aware that he would imminently be paying an escalated premium for Extending the lease. David extended the lease just in the nick of time last May. David and the landlord in the end settled on the final figure of £5,000 . If he had missed the deadline, the figure would have escalated by at least £1,075.
Last Autumn we were called by Mr and Mrs. N Flores , who moved into a purpose-built apartment in Stourbridge in February 2003. The dilemma was if we could estimate the compensation to the landlord would be for a ninety year extension to my lease. Comparative properties in Stourbridge with an extended lease were valued around £242,600. The average amount of ground rent was £45 collected annually. The lease ran out in 2093. Taking into account 67 years left we approximated the premium to the freeholder for the lease extension to be between £11,400 and £13,200 not including legals.
Last Christmas we were contacted by Dr B Watson , who purchased a one bedroom apartment in Stourbridge in April 2009. We are asked if we could approximate the compensation to the landlord would likely be to prolong the lease by a further 90 years. Identical premises in Stourbridge with 100 year plus lease were worth £280,000. The average amount of ground rent was £55 billed monthly. The lease finished in 2104. Given that there were 78 years outstanding we approximated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of professional charges.