The re-sale value of a leasehold property in Upney depends on how long the lease has remaining. If it is near to or less than 80 years you should envisage problems on re-sale, so it is recommended to arrange for a lease extension prior to purchasing. Ideally one should start the lease extension process when a lease still has 82 years unexpired so that a lease extension can be concluded prior to the eighty year cut off point. Leasehold Reform legislation enables Upney qualifying lessees to acquire a lease extension of 90 years in addition to the remaining length of the lease at a peppercorn rent (that is, rent free). The intention of the valuation is to determine the amount payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a property with over one hundred years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years left, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| 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 conveyancing solicitors that we work with handle Upney 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 conveyancing solicitor we work with provide it.
Last October Lucas, came precariously close to the eighty-year mark with the lease on his first floor apartment in Upney. In buying his property two decades ago, the unexpired term was of minimal interest. Thankfully, it dawned on him that he needed to take action soon on Extending the lease. Lucas arranged for a lease extension at the eleventh hour last March. Lucas and the landlord who owned the flat above subsequently agreed on sum of £5,500 . If he not met the deadline, the premium would have escalated by a minimum £900.
Mr Dylan Hall took over the lease of a ground floor apartment in Upney in January 2003. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be for a 90 year extension to my lease. Comparable properties in Upney with 100 year plus lease were worth £257,800. The mid-range amount of ground rent was £65 billed annually. The lease ended on 23 May 2091. Given that there were 65 years outstanding we calculated the compensation to the landlord to extend the lease to be between £18,100 and £20,800 not including legals.
An example of a Lease Extension matter before the tribunal for a Upney flat is 49 Aldborough Road South in July 2012. The Tribunal decided that the premium payable for the grant of the new lease was £13,925 This case was in relation to 1 flat. The remaining number of years on the lease was 61.36 years.