As the the remaining lease term of a Kingswood residential lease diminished so does its value and therefore the value of your property. If the lease has, beyond one hundred years to run then this decrease may be negligible that being said there will become a stage when a lease has fewer than eighty years remaining as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main reason why you should extend the lease without delay. The majority of flat owners in Kingswood will qualify for this right; that being said a conveyancing solicitor will be able to advise if you qualify for a lease extension. In limited situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
It is conventional wisdom that a property with more than 100 years remaining is worth roughly the same as a freehold. Where an additional ninety years added to any lease with more than 45 years left, the premises will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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; |
| Coventry Building Society | 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service gives you increased control over the value of your Kingswood leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Eliot owned a 2 bedroom flat in Kingswood being sold with a lease of a little over 61 years outstanding. Eliot on an informal basis contacted his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a new rent to start with set at £100 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Eliot to exercise his statutory right. Eliot procured expert legal guidance and secured an acceptable resolution informally and readily saleable.
Dr I Michel purchased a ground floor apartment in Kingswood in September 2006. The dilemma was if we could estimate the premium would be to prolong the lease by an additional years. Identical flats in Kingswood with an extended lease were valued about £223,400. The mid-range ground rent payable was £60 billed every twelve months. The lease came to a finish on 10 April 2084. Taking into account 59 years outstanding we calculated the compensation to the freeholder for the lease extension to be between £27,600 and £31,800 not including expenses.
Ms J Martínez was assigned a lease of a first floor flat in Kingswood in June 1998. The dilemma was if we could approximate the price would likely be for a 90 year lease extension. Similar flats in Kingswood with an extended lease were worth £210,000. The mid-range amount of ground rent was £50 collected quarterly. The lease ran out in 2104. Taking into account 79 years left we calculated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 not including legals.