The nearer a residential lease in Turvey nears to zero years unexpired, the more it reduces the value of the property. Where the residual term has, over one hundred years remaining then this decrease may be negligible that being said there will become a stage when a lease has under than 80 years remaining as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main logic behind why you should extend the lease sooner than later. The majority of flat owners in Turvey will qualify for this right; however a conveyancing solicitor will be able to confirm if you qualify for a lease extension. In limited situations you may not qualify, the most common reason being that you have owned the property for less than two years.
Leasehold residencies in Turvey with over one hundred years left 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 property. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges warrant 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; |
| Coventry Building Society | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with handle Turvey 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.
Nathaniel owned a conversion apartment in Turvey being marketed with a lease of fraction over fifty eight years outstanding. Nathaniel informally spoke with his landlord a well known Bristol-based freehold company for a lease extension. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £100 per annum and doubled every 25 years thereafter. No ground rent would be due on a lease extension were Nathaniel to exercise his statutory right. Nathaniel procured expert advice and was able to make a more informed judgement and handle with the matter and sell the flat.
In 2011 we were phoned by Dr L Bell who, having took over the lease of a recently refurbished apartment in Turvey in August 1999. The dilemma was if we could estimate the compensation to the landlord would likely be to extend the lease by ninety years. Similar properties in Turvey with 100 year plus lease were in the region of £186,000. The average amount of ground rent was £65 collected every twelve months. The lease expiry date was on 23 June 2083. Considering the 58 years outstanding we approximated the premium to the freeholder for the lease extension to be within £24,700 and £28,600 plus legals.
Mr and Mrs. L Alexander completed a one bedroom apartment in Turvey in February 2005. We are asked if we could estimate the price could be for a 90 year lease extension. Similar homes in Turvey with a long lease were valued about £250,000. The average amount of ground rent was £50 billed quarterly. The lease ran out on 13 August 2094. Considering the 69 years left we calculated the compensation to the freeholder for the lease extension to be within £9,500 and £11,000 exclusive of fees.