The nearer a domestic lease in Temple Fortune nears to zero years unexpired, the the greater the reduction in the value of the property. If the residual term has, over 100 years to run then this decrease may be fractional nevertheless there will become a stage when a lease has fewer than eighty years unexpired as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the primary reason why you should extend the lease sooner rather than later. The majority of flat owners in Temple Fortune will qualify for this right; that being said a conveyancer will be able to advise if you qualify to extend your lease. In certain situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold properties in Temple Fortune with in excess of 100 years unexpired on the lease are often referred to as ‘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 to be gained by purchasing the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| 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. |
Engaging our service gives you increased control over the value of your Temple Fortune leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Stanley owned a studio flat in Temple Fortune on the market with a lease of a few days over fifty eight years unexpired. Stanley on an informal basis approached his landlord a well known Manchester-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years subject to a rise in the rent to £125 annually. No ground rent would be due on a lease extension were Stanley to exercise his statutory right. Stanley obtained expert advice and was able to make a more informed judgement and deal with the matter and readily saleable.
In 2014 we were approached by Ms K Cook who, having moved into a basement flat in Temple Fortune in May 2004. The question was if we could estimate the price could be to prolong the lease by 90 years. Comparative residencies in Temple Fortune with 100 year plus lease were valued around £233,200. The average ground rent payable was £60 invoiced quarterly. The lease lapsed on 9 February 2086. Taking into account 61 years remaining we calculated the compensation to the landlord for the lease extension to be within £22,800 and £26,400 plus professional charges.
An example of a Lease Extension case for a Temple Fortune residence is Flat 2 2 Netherfield Road in April 2010. The Tribunale held that premium payable for a 90 year extension to the existing Lease should be £7,705. This case was in relation to 1 flat. The unexpired term was 76 years.