With a domestic leasehold property in Deeside, you are actually purchasing an entitlement to live in a property for a prescribed time frame. These days 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 think about extending the lease sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly particularly once there are fewer than eighty years remaining. Residents in Deeside with a lease approaching 81 years unexpired should seriously think of extending it sooner as opposed to later. When a lease has fewer than 80 years left, under the current Act the landlord can calculate and charge a larger premium, based on a technical computation, strangely termed as “marriage value” which is due.
It is generally considered that a property with over one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 30 years left, the property will be equivalent in value to a freehold for many years ahead.
| 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. |
| 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. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Yorkshire 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. |
The lawyers that we work with handle Deeside 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.
During the course of the last few months Felix, came precariously near to the eighty-year threshold with the lease on his two bedroom apartment in Deeside. In buying his home two decades ago, the unexpired term was of little significance. Fortunately, he realised he would soon be paying an inflated amount for Extending the lease. Felix arranged for a lease extension at the eleventh hour last August. Felix and the landlord eventually agreed on a premium of £6,000 . If he not met the deadline, the price would have gone up by at least £850.
Last Christmas we were called by Dr Tommy Clarke , who took over the lease of a ground floor apartment in Deeside in January 2005. The question was if we could shed any light on how much (approximately) compensation to the landlord would be to prolong the lease by 90 years. Similar properties in Deeside with a long lease were in the region of £184,000. The average amount of ground rent was £55 billed quarterly. The lease came to a finish on 5 April 2079. Considering the 53 years left we estimated the compensation to the freeholder for the lease extension to be within £28,500 and £33,000 exclusive of professional charges.
Mr and Mrs. S Jackson took over the lease of a studio apartment in Deeside in November 1998. The question was if we could estimate the price would likely be to extend the lease by a further 90 years. Identical properties in Deeside with an extended lease were worth £290,000. The average amount of ground rent was £45 billed annually. The lease elapsed on 24 August 2099. Taking into account 73 years unexpired we estimated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 plus expenses.