When it comes to residential leasehold property in Trowbridge, you are actually purchasing an entitlement to reside in a property for a prescribed time frame. In recent years flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you should think about a lease extension sooner rather than later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly particularly once there are fewer than eighty years left. Anyone in Trowbridge with a lease approaching 81 years remaining should seriously think of extending it as soon as possible. Once the lease term has less than eighty years left, under the current legislation the landlord is entitled to calculate and demand a greater premium, assessed on a technical calculation, strangely termed as “marriage value” which is payable.
Leasehold properties in Trowbridge with in excess of one hundred 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 property. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 |
The lawyers that we work with undertake Trowbridge 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 conveyancer we work with provide it.
Trailing unsuccessful negotiations with the landlord of her first floor apartment in Trowbridge, Megan started the lease extension process just as the lease was nearing the crucial eighty-year mark. The transaction completed in June 2012. The landlord’s fees were negotiated to under 500 GBP.
Mr and Mrs. N Sharif was assigned a lease of a garden apartment in Trowbridge in March 2006. We are asked if we could shed any light on how much (approximately) premium could be for a ninety year lease extension. Identical properties in Trowbridge with an extended lease were worth £252,800. The mid-range amount of ground rent was £65 invoiced annually. The lease terminated on 5 May 2090. Having 65 years remaining we approximated the compensation to the freeholder for the lease extension to be within £17,100 and £19,800 not including costs.
Last November we were approach by Mr D Bernard , who bought a one bedroom apartment in Trowbridge in March 2004. We are asked if we could estimate the price would be to extend the lease by 90 years. Comparative premises in Trowbridge with an extended lease were worth £191,400. The average amount of ground rent was £55 collected per annum. The lease ran out in 2079. Having 54 years left we calculated the compensation to the freeholder for the lease extension to be within £34,200 and £39,600 exclusive of fees.