Royton leases on residential properties are gradually losing value. Where your lease has in the region of ninety years remaining, you should start considering the need for a lease extension. An important point to note is that it is desirable for your lease extension to be in place before the term of the existing lease dips lower than 80 years - otherwise a higher amount will be due. Flat owners in Royton will mostly be legally entitled to a lease extension; however it’s a good idea to check with a conveyancer to confirm your eligibility. In some situations you may not be entitled. There are prescribed deadlines and formalities to comply with once the process has commenced so it’s sensible to be guided by a conveyancer during the process.
Leasehold properties in Royton with over 100 years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in buying the freehold unless savings on ground rent and maintenance charges warrant it.
| 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; |
| 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. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Royton,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Royton valuers.
Following unsuccessful correspondence with the freeholder of her two bedroom flat in Royton, Jessica commenced the lease extension process just as her lease was approaching the crucial eighty-year mark. The lease extension completed in July 2008. The landlord’s fees were kept to an absolute minimum.
Dr B Carter bought a studio flat in Royton in June 2010. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be to extend the lease by ninety years. Similar properties in Royton with a long lease were in the region of £216,000. The average amount of ground rent was £60 billed yearly. The lease ended on 15 September 2083. Given that there were 58 years as a residual term we estimated the compensation to the landlord for the lease extension to be within £28,500 and £33,000 not including legals.
Mr and Mrs. E Watson acquired a one bedroom apartment in Royton in August 1995. We are asked if we could approximate the premium would likely be for a 90 year lease extension. Comparable homes in Royton with a long lease were worth £205,000. The mid-range amount of ground rent was £50 collected per annum. The lease concluded on 21 May 2104. Taking into account 79 years as a residual term we calculated the compensation to the freeholder to extend the lease to be between £7,600 and £8,800 not including professional charges.