Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will normally be granted for a fixed period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Acocks Green. Inevitably, the length of lease left reduces as time goes by. This may slip by relatively unnoticed when the residence has to be sold or refinanced. The fewer the years remaining the less it is worth and the more it will cost to obtain a lease extension. Eligible long lease owners in Acocks Green have the right to extend the lease for a further 90 years under statute. You should give due deliberation before putting off your Acocks Green lease extension. Holding off that expense now simply increases the price you will ultimately incur to extend your lease
Leasehold residencies in Acocks Green with more than 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| 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. |
| Halifax | 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. |
Using our service gives you enhanced control over the value of your Acocks Green leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
During the course of the last few months Dylan, came perilously close to the eighty-year threshold with the lease on his leasehold apartment in Acocks Green. Having purchased his flat 19 years previously, the lease term was of minimal bearing. Thankfully, he became aware that he would soon be paying way over the odds for a lease extension. Dylan was able to extend his lease just under the wire last March. Dylan and the landlord who owned the flat above in the end settled on sum of £5,500 . If the lease had fallen below 80 years, the price would have gone up by a minimum £1,000.
Mr Jonathan Carter moved into a studio apartment in Acocks Green in March 2008. We are asked if we could shed any light on how much (approximately) price would be for a ninety year extension to my lease. Comparable flats in Acocks Green with 100 year plus lease were in the region of £255,000. The average ground rent payable was £50 invoiced monthly. The lease finished on 25 April 2095. Considering the 70 years remaining we estimated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 not including expenses.
Dr V Rivera took over the lease of a one bedroom flat in Acocks Green in August 2012. The dilemma was if we could estimate the premium would be for a 90 year lease extension. Comparative premises in Acocks Green with a long lease were in the region of £246,800. The mid-range amount of ground rent was £60 billed yearly. The lease expired in 2075. Considering the 50 years unexpired we estimated the compensation to the landlord for the lease extension to be within £44,700 and £51,600 exclusive of fees.