Thornhill leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. It is the case that most Thornhill tenants have the right to extend their lease by an additional ninety years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in Thornhill you must investigate if your lease has between seventy and ninety years remaining. In particular once the remaining lease term slips under 80 years, the cost of any lease extension increases dramatically as part of the premium you pay is what is known as a marriage value
Leasehold properties in Thornhill with over 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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 |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Thornhill,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Thornhill valuers.
Edward was the the leasehold proprietor of a 2 bedroom flat in Thornhill on the market with a lease of just over fifty eight years outstanding. Edward informally contacted his freeholder being a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent at the outset set at £100 per annum and doubled every twenty five years thereafter. No ground rent would be payable on a lease extension were Edward to exercise his statutory right. Edward obtained expert advice and secured satisfactory resolution without going to tribunal and readily saleable.
Ms H Watson completed a ground floor flat in Thornhill in January 1998. The dilemma was if we could approximate the price would be for a 90 year lease extension. Comparative flats in Thornhill with an extended lease were worth £216,000. The mid-range amount of ground rent was £60 invoiced per annum. The lease came to a finish on 11 May 2084. Considering the 58 years left we approximated the compensation to the freeholder to extend the lease to be within £28,500 and £33,000 plus legals.
In 2010 we were contacted by Mrs Lucy Moreau who, having purchased a ground floor apartment in Thornhill in September 2008. The question was if we could estimate the price could be to prolong the lease by a further 90 years. Comparative flats in Thornhill with 100 year plus lease were in the region of £200,000. The average ground rent payable was £50 invoiced annually. The lease end date was on 28 September 2104. Taking into account 78 years unexpired we estimated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 not including costs.