Unfortunately that a Swavesey residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the reduction being disguised by increases in the Swavesey property market.Once your lease gets to 85ish years, you should start thinking about a lease extension. If lease term slips below 80 years, you will then be required to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property Most leasehold owners in Swavesey will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you are eligibility. In some cases you may not qualify. There are also strict timeframes and procedures to be adhered to once the process is initiated and you will need to be guided by your lawyer throughout the formalities.
It is conventional wisdom that a residential leasehold with more than 100 years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for many years ahead.
| 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a freeholder in Swavesey,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Swavesey valuers.
Last Summer Stanley, came perilously near to the eighty-year mark with the lease on his first floor flat in Swavesey. In buying his home two decades ago, the lease term was of minimal interest. by good luck, he recognised he needed to take steps soon on Extending the lease. Stanley was able to extend his lease just in the nick of time in August. Stanley and the landlord who owned the flat above in the end settled on an amount of £5,000 . If the lease had fallen below 80 years, the premium would have gone up by at least £875.
Mr and Mrs. J Turner bought a recently refurbished apartment in Swavesey in May 2001. We are asked if we could estimate the compensation to the landlord could be to prolong the lease by ninety years. Similar homes in Swavesey with 100 year plus lease were valued around £295,000. The average ground rent payable was £50 billed monthly. The lease ended on 7 September 2101. Given that there were 75 years as a residual term we approximated the compensation to the freeholder to extend the lease to be within £8,600 and £9,800 plus professional charges.
In 2010 we were approached by Dr T Evans who, having bought a purpose-built apartment in Swavesey in March 2004. We are asked if we could approximate the compensation to the landlord would be to prolong the lease by a further 90 years. Comparable homes in Swavesey with a long lease were in the region of £250,400. The average ground rent payable was £65 invoiced annually. The lease came to a finish in 2090. Considering the 64 years unexpired we calculated the premium to the freeholder to extend the lease to be within £19,000 and £22,000 exclusive of costs.