With a domestic leasehold premises in Arlesey, you are actually buying a right to live in a property for a set period of time. Modern flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you should think about a lease extension sooner rather than later. Accepted thinking is that the shorter the number of years is the cost of extending the lease becomes disproportionately greater particularly once there are less than eighty years remaining. Leasehold owners in Arlesey with a lease approaching 81 years unexpired should seriously consider extending it sooner as opposed to later. When the lease term has under eighty years remaining, under the current legislation the freeholder can calculate and levy a greater premium, assessed on a technical calculation, known as “marriage value” which is payable.
It is generally considered that a property with over one hundred years remaining is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 45 years remaining, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Chelsea Building Society | 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. |
| Lloyds TSB Scotland | 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Irrespective of whether you are a tenant or a landlord in Arlesey,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 in-depth market knowledge and the close ties they enjoy with Arlesey valuers.
Thomas was the the leasehold proprietor of a 2 bedroom apartment in Arlesey being sold with a lease of a little over sixty years left. Thomas on an informal basis contacted his freeholder a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £100 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Thomas to exercise his statutory right. Thomas procured expert legal guidance and secured satisfactory deal informally and readily saleable.
Mr David Harris was assigned a lease of a one bedroom flat in Arlesey in July 2008. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be for a ninety year extension to my lease. Comparable properties in Arlesey with an extended lease were valued about £285,000. The average amount of ground rent was £55 billed quarterly. The lease concluded in 2104. Having 79 years left we estimated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 plus costs.
Mr N Alexander completed a purpose-built flat in Arlesey in July 2000. The dilemma was if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Identical flats in Arlesey with 100 year plus lease were in the region of £198,400. The mid-range ground rent payable was £65 invoiced monthly. The lease lapsed in 2084. Given that there were 59 years unexpired we estimated the compensation to the freeholder for the lease extension to be within £21,900 and £25,200 exclusive of legals.