It’s an underpublicised certainty that a Upney residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the depreciation being disguised by increases in the Upney property prices.Where your lease has approximately ninety years left, you need to start considering a lease extension. If lease term drops below 80 years, you will then be required to pay half of the property's 'marriage value' in addition to 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 Upney will be able to extend under the legislation; however a lawyer should be able to clarify whether you are eligibility. In some cases you may not be entitled. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your lawyer from beginning to end of the formalities.
It is generally considered that a residential leasehold with over one hundred years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 30 years left, the residence will be equivalent in value to a freehold for decades to come.
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| 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 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 lawyer we work with provide it.
Seth was the the leasehold proprietor of a 2 bedroom apartment in Upney being marketed with a lease of a little over sixty years remaining. Seth on an informal basis approached his freeholder a well known Bristol-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of an increased rent to £100 per annum. Ordinarily, ground rent would not be due on a lease extension were Seth to invoke his statutory right. Seth obtained expert advice and secured an acceptable deal informally and readily saleable.
In 2009 we were approached by Ms Kate Martin who, having was assigned a lease of a one bedroom apartment in Upney in May 2001. The dilemma was if we could estimate the compensation to the landlord could be to prolong the lease by ninety years. Similar homes in Upney with a long lease were worth £201,200. The mid-range amount of ground rent was £55 collected per annum. The lease ran out on 2 November 2081. Considering the 56 years outstanding we calculated the compensation to the freeholder to extend the lease to be within £31,400 and £36,200 plus professional charges.
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 unexpired term was 61.36 years.