Unfortunately that a Ripley 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 loss of value being disguised by increases in the Ripley property prices.Once your lease nears 85ish years, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls below 80 years - otherwise a higher amount will be due. The majority of flat owners in Ripley will be able to extend under the legislation; however a conveyancer will be able to confirm if you qualify for an extension. In some cases you may not be entitled. There are also strict timeframes and procedures to follow once the process is initiated and you will need to be guided by your lawyer for the duration of the formalities.
It is generally accepted that a residential leasehold with more than 100 years remaining is worth roughly the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
The conveyancers that we work with handle Ripley 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 conveyancing solicitor we work with provide it.
During the course of the last few months Nathan, came critically close to the 80-year mark with the lease on his basement apartment in Ripley. Having bought his flat two decades ago, the lease term was of little bearing. by good luck, he realised he would soon be paying an escalated premium for a lease extension. Nathan extended the lease just in the nick of time last January. Nathan and the landlord in the end agreed on a premium of £5,000 . If he failed to meet the deadline, the premium would have gone up by at least £1,000.
In 2014 we were contacted by Mr and Mrs. C Rose who, having moved into a studio apartment in Ripley in November 1996. The question was if we could approximate the price could be for a 90 year extension to my lease. Comparable flats in Ripley with 100 year plus lease were in the region of £200,800. The mid-range amount of ground rent was £65 billed per annum. The lease end date was in 2086. Having 60 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £20,900 and £24,200 not including expenses.
Mr and Mrs. T Howard acquired a one bedroom flat in Ripley in November 2002. We are asked if we could approximate the compensation to the landlord would likely be for a 90 year lease extension. Identical flats in Ripley with a long lease were in the region of £255,000. The average amount of ground rent was £50 invoiced annually. The lease came to a finish on 14 June 2097. Given that there were 71 years remaining we approximated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of fees.