When it comes to long leasehold premises in Yarm, you effectively rent it for a certain period of time. In recent years flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you may consider extending the lease sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease becomes disproportionately more expensive notably once there are less than eighty years left. Residents in Yarm with a lease approaching 81 years unexpired should seriously consider extending it without delay. Once the lease term has under eighty years left, under the relevant statute the freeholder can calculate and charge a larger premium, based on a technical computation, strangely termed as “marriage value” which is payable.
It is conventional wisdom that a property with in excess of 100 years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to any lease with more than 45 years remaining, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a freeholder in Yarm,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Yarm valuers.
Reuben was the the leasehold owner of a studio flat in Yarm on the market with a lease of just over 59 years unexpired. Reuben informally approached his landlord being a well known London-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 at the outset set at £150 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Reuben to exercise his statutory right. Reuben procured expert legal guidance and was able to make a more informed judgement and handle with the matter and ending up with a market value flat.
Dr V Norbert owned a studio apartment in Yarm in May 1999. We are asked if we could estimate the premium would be to prolong the lease by ninety years. Identical properties in Yarm with a long lease were worth £275,000. The average ground rent payable was £65 invoiced yearly. The lease elapsed in 2094. Considering the 68 years as a residual term we estimated the premium to the freeholder for the lease extension to be within £13,300 and £15,400 exclusive of fees.
Mr and Mrs. I Turner took over the lease of a one bedroom flat in Yarm in June 1998. We are asked if we could approximate the price would be for a ninety year lease extension. Comparable flats in Yarm with 100 year plus lease were valued about £208,600. The mid-range ground rent payable was £60 collected monthly. The lease concluded in 2083. Taking into account 57 years as a residual term we approximated the premium to the freeholder for the lease extension to be within £30,400 and £35,200 exclusive of expenses.