When it comes to long leasehold property in Peak District, you are actually purchasing a right to reside in a property for a set period of time. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you may think about a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly notably once there are less than eighty years left. Residents in Peak District with a lease drawing near to 81 years remaining should seriously think of extending it sooner rather than later. Once a lease has under eighty years remaining, under the relevant Act the freeholder is entitled to calculate and levy a larger premium, assessed on a technical calculation, known as “marriage value” which is due.
Leasehold premises in Peak District with over 100 years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | Minimum 70 years from the date 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Engaging our service will provide you better control over the value of your Peak District leasehold, as your property will be more valuable and saleable in respect 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.
Last year Jamie, started to get near to the eighty-year threshold with the lease on his purpose- built apartment in Peak District. In buying his home 18 years previously, the length of the lease was of no importance. Thankfully, it dawned on him that he would soon be paying an escalated premium for a lease extension. Jamie arranged for a lease extension at the eleventh hour last April. Jamie and the landlord in the end settled on an amount of £6,000 . If he had missed the deadline, the premium would have escalated by at least £850.
In 2010 we were called by Mr and Mrs. M Hernández who, having acquired a ground floor flat in Peak District in June 2007. The question was if we could estimate the compensation to the landlord could be for a ninety year extension to my lease. Similar properties in Peak District with 100 year plus lease were worth £260,000. The mid-range amount of ground rent was £50 invoiced every twelve months. The lease ended in 2098. Given that there were 73 years left we approximated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 not including fees.
Last Christmas we were e-mailed by Mr and Mrs. E Clarke , who acquired a purpose-built flat in Peak District in August 2007. The dilemma was if we could approximate the compensation to the landlord would be to prolong the lease by a further 90 years. Comparative properties in Peak District with 100 year plus lease were in the region of £261,600. The mid-range amount of ground rent was £60 invoiced per annum. The lease ended in 2077. Considering the 52 years left we estimated the compensation to the landlord for the lease extension to be within £39,000 and £45,000 not including fees.