It’s a harsh certainty that a Strood residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Strood property market.Once your lease gets to 85ish years, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips under eighty years - otherwise a higher amount will be payable. The majority of leasehold owners in Strood will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm whether you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer from beginning to end of the formalities.
It is conventional wisdom that a property with more than one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Engaging our service will provide you increased control over the value of your Strood leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Trailing lengthy discussions with the landlord of her two bedroom apartment in Strood, Amy commenced the lease extension process just as her lease was coming close to the crucial eighty-year mark. The lease extension was finalised in November 2008. The freeholder’s charges were negotiated to slightly above 500 pounds.
Dr Ellen Cook bought a first floor apartment in Strood in November 2010. We are asked if we could approximate the price would be for a ninety year extension to my lease. Similar homes in Strood with a long lease were in the region of £206,200. The mid-range ground rent payable was £60 collected annually. The lease expired on 2 July 2082. Given that there were 56 years as a residual term we approximated the compensation to the landlord to extend the lease to be within £31,400 and £36,200 plus professional charges.
Mrs Ashleigh Morris owned a recently refurbished apartment in Strood in October 2006. We are asked if we could estimate the price would likely be for a 90 year extension to my lease. Comparative premises in Strood with an extended lease were valued around £300,000. The average amount of ground rent was £50 invoiced quarterly. The lease expired in 2102. Having 76 years unexpired we calculated the compensation to the landlord for the lease extension to be between £8,600 and £9,800 not including legals.