There is no doubt about it a leasehold property in Potton is a wasting asset as a result of the diminishing lease term. If the lease has, more than one hundred years remaining then this decrease may be negligible that being said there will become a point in time when a lease has under than eighty years remaining as part of the premium you will incur is what is known as a marriage value. This could increase markedly the cost. It is the main reason why you should consider extending without delay. The majority of flat owners in Potton will qualify for this right; nevertheless a conveyancing solicitor can advise if you qualify for a lease extension. In limited situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
It is conventional wisdom that a residential leasehold with over one hundred years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be worth the same as 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
The conveyancers that we work with procure Potton lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Two years ago Harrison, came critically close to the 80-year threshold with the lease on his first floor apartment in Potton. In buying his property two decades ago, the length of the lease was of little importance. Fortunately, he noticed he needed to take steps soon on a lease extension. Harrison was able to extend his lease at the eleventh hour in July. Harrison and the landlord who owned the flat above ultimately agreed on a premium of £6,000 . If the lease had dipped below 80 years, the sum would have gone up by a minimum £1,075.
In 2014 we were called by Mr and Mrs. F Martínez who, having took over the lease of a newly refurbished flat in Potton in February 2011. We are asked if we could approximate the price would be for a 90 year lease extension. Comparative properties in Potton with an extended lease were in the region of £275,000. The average amount of ground rent was £65 billed annually. The lease lapsed in 2093. Considering the 68 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £12,400 and £14,200 exclusive of professional charges.
Last Christmas we were phoned by Dr Elijah Nguyen , who was assigned a lease of a purpose-built apartment in Potton in February 2004. The dilemma was if we could approximate the price would likely be for a ninety year lease extension. Comparable homes in Potton with 100 year plus lease were worth £208,600. The average amount of ground rent was £60 collected per annum. The lease came to a finish on 23 November 2082. Considering the 57 years remaining we approximated the premium to the landlord to extend the lease to be within £30,400 and £35,200 plus expenses.