As the length of the unexpired term of a Newbury Park residential lease decreases so does its value and therefore the value of your property. If the residual term has, beyond 99 years to run then this decrease may be of little impact that being said there will become a point in time when a lease has under than eighty years unexpired as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the primary rational as to why you should extend the lease sooner rather than later. Most flat owners in Newbury Park will meet the qualifying criteria; however a conveyancer can advise if you are eligible for a lease extension. In certain 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 residential leasehold with more than one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to 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; |
| 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. |
| 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. |
| 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. |
Using our service gives you better control over the value of your Newbury Park leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In recent months Austin, came dangerously close to the 80-year threshold with the lease on his two bedroom apartment in Newbury Park. In buying his home 18 years ago, the lease term was of minimal bearing. by good luck, it dawned on him that he would soon be paying an inflated amount for Extending the lease. Austin was able to extend his lease just under the wire in September. Austin and the freeholder in the end settled on the final figure of £5,500 . If the lease had slipped below 80 years, the premium would have gone up by at least £925.
In 2010 we were approached by Ms S Sharif who, having owned a ground floor apartment in Newbury Park in March 2002. We are asked if we could estimate the price could be for a ninety year extension to my lease. Comparative flats in Newbury Park with 100 year plus lease were in the region of £189,000. The average amount of ground rent was £55 invoiced monthly. The lease ran out in 2078. Considering the 53 years unexpired we approximated the compensation to the landlord to extend the lease to be between £28,500 and £33,000 not including professional charges.
An example of a Lease Extension matter before the tribunal for a Newbury Park flat is 104 Coventry Road in July 2014. The Tribunal determined that the lease extension permium should be £22,896.15 This case was in relation to 1 flat. The remaining number of years on the lease was 60.29 years.