The nearer a residential lease in Denbigh gets to zero years unexpired, the the greater the reduction in the value of the property. Where the lease has, over one hundred years remaining then this decrease may be of little impact nevertheless there will become a stage when a lease has under than 80 years left as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the main logic behind why you should extend the lease sooner than later. Many flat owners in Denbigh will meet the qualifying criteria; however a lawyer will be able to advise whether you are eligible for a lease extension. In certain situations you may not qualify, the most frequent reason being that you have owned the property for under two years.
Leasehold residencies in Denbigh with over 100 years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and service charges justify it.
| 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. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Leeds Building Society | 85 years remaining from the start 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 conveyancers that we work with undertake Denbigh 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 conveyancing solicitor we work with provide it.
Two years ago Jamie, started to get close to the eighty-year mark with the lease on his garden flat in Denbigh. Having purchased his home 19 years ago, the length of the lease was of little significance. Thankfully, he became aware that he would imminently be paying an escalated premium for a lease extension. Jamie was able to extend his lease just under the wire in May. Jamie and the landlord who owned the flat above eventually agreed on an amount of £6,000 . If he failed to meet the deadline, the amount would have gone up by at least £975.
Last Summer we were contacted by Mr T Howard , who acquired a basement apartment in Denbigh in July 2012. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be for a ninety year extension to my lease. Comparable properties in Denbigh with 100 year plus lease were worth £191,400. The mid-range amount of ground rent was £55 invoiced every twelve months. The lease came to a finish in 2078. Taking into account 54 years as a residual term we approximated the premium to the landlord to extend the lease to be within £34,200 and £39,600 plus fees.
In 2014 we were e-mailed by Ms T Harris who, having acquired a one bedroom apartment in Denbigh in September 2011. We are asked if we could approximate the price could be for a 90 year extension to my lease. Similar residencies in Denbigh with an extended lease were valued about £295,000. The average ground rent payable was £45 billed annually. The lease lapsed on 21 May 2098. Given that there were 74 years unexpired we calculated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of legals.