There is no doubt about it a leasehold property in Rye is a wasting asset as a result of the diminishing lease term. If the residual term has, over 100 years remaining then this decrease may be negligible that being said there will become a stage when a lease has fewer than 80 years remaining as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the primary rational as to why you should consider extending without delay. Most flat owners in Rye will meet the qualifying criteria; nevertheless a conveyancing solicitor can confirm if you qualify to extend your lease. In certain situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
Leasehold properties in Rye with over 100 years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and estate 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | 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. |
Lease extensions in Rye can be a difficult process. We recommend you secure guidance from a lawyer and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Rye lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Archie owned a 2 bedroom apartment in Rye being sold with a lease of a few days over 61 years unexpired. Archie informally approached his freeholder a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £200 per annum. Ordinarily, ground rent would not be due on a lease extension were Archie to invoke his statutory right. Archie procured expert advice and was able to make an informed judgement and deal with the matter and ending up with a market value flat.
In 2010 we were contacted by Dr Jamie Murphy who, having completed a newly refurbished apartment in Rye in August 2005. We are asked if we could shed any light on how much (approximately) premium would be for a ninety year lease extension. Similar homes in Rye with 100 year plus lease were worth £218,400. The mid-range amount of ground rent was £60 collected quarterly. The lease ended in 2083. Given that there were 59 years as a residual term we estimated the premium to the landlord for the lease extension to be within £27,600 and £31,800 exclusive of expenses.
Last Summer we were phoned by Mr and Mrs. U Sharif , who purchased a one bedroom flat in Rye in February 1996. We are asked if we could approximate the premium could be for a ninety year extension to my lease. Similar flats in Rye with a long lease were valued around £205,000. The mid-range ground rent payable was £50 billed monthly. The lease lapsed on 18 October 2103. Considering the 79 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 plus fees.