For anyone whose Kingstanding home is held on a long lease, our message is clear – if you ignore the situation, the property will ultimately revert to the freeholder, leaving you empty-handed. The fewer the years remaining the less it is worth and the more expensive it will be to extend the lease.
Leasehold premises in Kingstanding with over one hundred years left on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| 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. |
Retaining our service will provide you enhanced control over the value of your Kingstanding leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Following protracted negotiations with the freeholder of her basement apartment in Kingstanding, Kelsey started the lease extension process as the eighty year deadline was rapidly coming. The transaction was concluded in October 2014. The freeholder’s fees were negotiated to under 450 GBP.
In 2013 we were contacted by Mrs S Murphy who, having moved into a ground floor flat in Kingstanding in June 1995. We are asked if we could estimate the price could be to extend the lease by ninety years. Comparative premises in Kingstanding with a long lease were worth £290,000. The average ground rent payable was £45 invoiced annually. The lease ended on 14 August 2099. Given that there were 73 years unexpired we approximated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of professional charges.
In 2010 we were e-mailed by Mr B Simon who, having moved into a first floor apartment in Kingstanding in January 2008. The dilemma was if we could estimate the premium could be to prolong the lease by ninety years. Similar premises in Kingstanding with an extended lease were worth £240,600. The mid-range ground rent payable was £60 collected yearly. The lease concluded in 2088. Having 62 years remaining we approximated the compensation to the freeholder for the lease extension to be between £21,900 and £25,200 plus expenses.