The closer a domestic lease in Swindon gets to zero years unexpired, the the greater the reduction in the value of the property. Where the residual term has, beyond 100 years to run then this decrease may be negligible nevertheless there will become a point in time when a lease has less than eighty years remaining as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the main rational as to why you should extend the lease sooner than later. The majority of flat owners in Swindon will qualify for this right; that being said a conveyancing solicitor should be able to advise whether you qualify for a lease extension. In certain situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
Leasehold premises in Swindon with over one hundred 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 home. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges warrant 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. |
| 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; |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Swindon,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 Swindon valuers.
Last year Stanley, started to get near to the 80-year threshold with the lease on his studio apartment in Swindon. Having purchased his home 19 years ago, the lease term was of no relevance. Thankfully, he recognised he needed to take steps soon on Extending the lease. Stanley extended the lease at the eleventh hour last July. Stanley and the freeholder via the managing agents in the end settled on an amount of £6,000 . If the lease had dropped lower than eighty years, the price would have gone up by a minimum £1,100.
In 2009 we were e-mailed by Mr and Mrs. C Johnson who, having acquired a one bedroom flat in Swindon in June 2002. We are asked if we could approximate the premium would be to extend the lease by 90 years. Comparative properties in Swindon with an extended lease were worth £246,800. The average amount of ground rent was £60 collected annually. The lease lapsed in 2076. Considering the 50 years remaining we calculated the premium to the freeholder for the lease extension to be between £44,700 and £51,600 exclusive of fees.
Mr and Mrs. E Peterson owned a ground floor flat in Swindon in October 2010. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to extend the lease by an additional years. Comparable residencies in Swindon with 100 year plus lease were valued about £203,200. The average ground rent payable was £65 collected annually. The lease expired on 13 June 2087. Considering the 61 years remaining we estimated the premium to the freeholder for the lease extension to be within £20,000 and £23,000 exclusive of fees.