It’s a harsh truth that a Townhill residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the early years due to the depreciation being disguised by increases in the Townhill property market.Once your lease nears 85ish years, you should start considering a lease extension. If the number of years remaining slips under eighty 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 additional value that a lease extension will add the property Most leasehold owners in Townhill will be able to extend under the legislation; however a conveyancer should be able to clarify 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 throughout the process.
Leasehold residencies in Townhill with more than 100 years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges justify 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 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; |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with procure Townhill lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Off the back of lengthy discussions with the landlord of her studio flat in Townhill, Mia initiated the lease extension process as the 80 year threshold was swiftly approaching. The legal work completed in April 2014. The freeholder’s charges were negotiated to less than 650 GBP.
In 2013 we were e-mailed by Dr E Mason who, having was assigned a lease of a newly refurbished apartment in Townhill in September 2001. We are asked if we could shed any light on how much (approximately) price could be to prolong the lease by an additional years. Comparative homes in Townhill with an extended lease were worth £191,400. The average ground rent payable was £55 collected monthly. The lease ended in 2079. Taking into account 54 years as a residual term we approximated the compensation to the landlord for the lease extension to be between £34,200 and £39,600 not including costs.
Last Summer we were contacted by Mr and Mrs. U Cook , who was assigned a lease of a ground floor apartment in Townhill in November 1999. We are asked if we could approximate the price would be for a 90 year lease extension. Comparative residencies in Townhill with a long lease were in the region of £295,000. The average ground rent payable was £45 billed monthly. The lease ran out in 2099. Given that there were 74 years outstanding we calculated the premium to the landlord for the lease extension to be between £8,600 and £9,800 exclusive of professional charges.