Unfortunately that a Neston residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the Neston property market.Where your lease has approximately 90 years left, you should start thinking about a lease extension. If lease term falls under 80 years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Neston will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm whether you qualify for an extension. In some cases you may not qualify. There are also strict timetables and procedures to be adhered to once the process is instigated and you will need to be guided by your lawyer from beginning to end of the process.
It is conventional wisdom that a property with in excess of 100 years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Chelsea 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. |
| 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. |
| 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 |
Regardless of whether you are a tenant or a freeholder in Neston,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Neston valuers.
Two years ago Ibrahim, started to get near to the 80-year mark with the lease on his ground floor apartment in Neston. In buying his flat two decades ago, the lease term was of no interest. As luck would have it, he became aware that he needed to take action soon on a lease extension. Ibrahim arranged for a lease extension at the eleventh hour in June. Ibrahim and the freeholder subsequently settled on the final figure of £5,500 . If the lease had descended to less than 80 years, the amount would have gone up by a minimum £925.
Dr Robyn Anderson moved into a one bedroom flat in Neston in March 2011. The question was if we could estimate the price would likely be for a ninety year extension to my lease. Identical premises in Neston with 100 year plus lease were in the region of £225,800. The average ground rent payable was £60 billed annually. The lease ran out on 24 May 2085. Given that there were 60 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £23,800 and £27,400 plus fees.
Mrs Nicole Davies moved into a purpose-built flat in Neston in January 2007. We are asked if we could approximate the premium would likely be for a ninety year lease extension. Identical flats in Neston with an extended lease were in the region of £210,000. The mid-range amount of ground rent was £50 billed per annum. The lease concluded in 2105. Taking into account 80 years remaining we estimated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 exclusive of expenses.