There is no doubt about it a leasehold flat or house in Prestbury is a wasting asset as a result of the diminishing lease term. Where the residual term has, more than 125 years to run then this decrease may be of little impact nevertheless there will become a point in time when a lease has under than 80 years remaining as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main reason why you should extend the lease without delay. The majority of flat owners in Prestbury will meet the qualifying criteria; however a conveyancer will be able to advise whether you are eligible 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 generally accepted that a property with over 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 45 years left, the premises will be worth the same as 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; |
| 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. |
| Godiva Mortgages | 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 |
Irrespective of whether you are a tenant or a freeholder in Prestbury,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 experience and the close ties they enjoy with Prestbury valuers.
Half a year ago Evan, came critically close to the eighty-year threshold with the lease on his purpose- built flat in Prestbury. Having purchased his property 19 years ago, the unexpired term was of no concern. by good luck, he realised he needed to take action soon on a lease extension. Evan arranged for a lease extension at the eleventh hour in June. Evan and the landlord ultimately settled on sum of £5,500 . If the lease had slipped to less than eighty years, the sum would have gone up by at least £900.
Dr D Martínez acquired a garden flat in Prestbury in April 1996. The question was if we could approximate the premium would be for a ninety year extension to my lease. Comparable residencies in Prestbury with a long lease were worth £256,600. The average ground rent payable was £60 billed per annum. The lease ran out on 11 March 2076. Taking into account 52 years outstanding we estimated the compensation to the freeholder for the lease extension to be within £41,800 and £48,400 not including fees.
In 2013 we were approached by Dr L Cooper who, having moved into a newly refurbished apartment in Prestbury in November 2003. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be for a ninety year extension to my lease. Identical flats in Prestbury with an extended lease were valued about £218,000. The mid-range amount of ground rent was £45 billed annually. The lease ran out in 2087. Having 63 years left we approximated the compensation to the landlord to extend the lease to be between £17,100 and £19,800 exclusive of costs.