When it comes to residential leasehold premises in Stow on the Wold, you effectively rent it for a certain period of time. Modern flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you should think about extending the lease sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly notably once there are less than eighty years remaining. Leasehold owners in Stow on the Wold with a lease approaching 81 years left should seriously consider extending it without delay. When the lease term has under eighty years outstanding, under the relevant Act the landlord is entitled to calculate and levy a greater premium, based on a technical computation, known as “marriage value” which is due.
Leasehold premises in Stow on the Wold with more than 100 years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in 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. |
| 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. |
| 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. |
| 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 |
Irrespective of whether you are a tenant or a freeholder in Stow on the Wold,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Stow on the Wold valuers.
After lengthy correspondence with the freeholder of her leasehold apartment in Stow on the Wold, Bethany initiated the lease extension process just as her lease was approaching the critical eighty-year mark. The lease extension was concluded in May 2012. The landlord’s charges were restricted to about 600 pounds.
Last Summer we were called by Dr Jack Sánchez , who owned a one bedroom flat in Stow on the Wold in July 2007. We are asked if we could approximate the premium would likely be for a ninety year lease extension. Comparable residencies in Stow on the Wold with an extended lease were valued around £166,400. The mid-range amount of ground rent was £60 billed every twelve months. The lease end date was on 11 July 2080. Taking into account 54 years as a residual term we estimated the compensation to the freeholder to extend the lease to be between £32,300 and £37,400 not including legals.
In 2014 we were contacted by Mr and Mrs. I Thomas who, having owned a newly refurbished flat in Stow on the Wold in June 1996. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be to prolong the lease by ninety years. Identical premises in Stow on the Wold with an extended lease were valued about £227,800. The mid-range ground rent payable was £45 collected quarterly. The lease elapsed on 8 May 2091. Given that there were 65 years remaining we estimated the premium to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of expenses.