The nearer a domestic lease in Moorgate gets to zero years unexpired, the more it reduces the value of the property. Where the lease has, beyond 99 years remaining then this decrease may be of little impact nevertheless there will become a stage when a lease has under than eighty years left as part of the premium you will incur is what is termed as a marriage value. This could increase markedly the cost. It is the primary reason why you should extend the lease sooner rather than later. Many flat owners in Moorgate will meet the qualifying criteria; nevertheless a lawyer should be able to confirm whether you are eligible to extend your lease. In certain situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
It is conventional wisdom that a property with more than 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| 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; |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 |
Engaging our service will provide you enhanced control over the value of your Moorgate leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Connor owned a high value apartment in Moorgate being sold with a lease of fraction over fifty eight years unexpired. Connor informally spoke with his freeholder being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £200 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Connor to exercise his statutory right. Connor obtained expert legal guidance and secured an acceptable resolution informally and sell the flat.
Last Spring we were approach by Dr Jackson Bonnet , who completed a studio flat in Moorgate in July 2001. The dilemma was if we could approximate the premium would be for a ninety year lease extension. Similar residencies in Moorgate with 100 year plus lease were in the region of £191,400. The average ground rent payable was £55 collected monthly. The lease came to a finish in 2079. Having 54 years outstanding we approximated the premium to the freeholder to extend the lease to be between £34,200 and £39,600 exclusive of costs.
An example of a Lease Extension case for a Moorgate property is 137 & 139 Haberdasher Street in December 2013. The Tribunal determines in accordance with section 48 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 that the premium for the extended lease for each Property should be £12,350.00. This case related to 2 flats. The unexpired term was 72.39 years.