Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will ordinarily be granted for a fixed period of time , usually 99 or 125 years, although we have come across longer and shorter terms in Slough. Clearly, the period of lease left reduces over time. This is often ignored and only becomes a problem when the flat or house has to be disposed of or refinanced. The fewer the years remaining the less it is worth and the more it will cost to obtain a lease extension. Eligible leaseholders in Slough have the legal entitlement to extend the lease for an additional ninety years in accordance with Leasehold Reform legislation. Do give due consideration before delaying your Slough lease extension. Holding off that expense now likely increases the price you will ultimately incur to extend your lease
Leasehold properties in Slough with in excess of one hundred 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 home. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
The conveyancing solicitors that we work with handle Slough 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.
George owned a 2 bedroom apartment in Slough on the market with a lease of just over fifty eight years outstanding. George informally contacted his landlord being a well known local-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent at the outset set at £150 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were George to invoke his statutory right. George procured expert advice and was able to make an informed decision and deal with the matter and readily saleable.
In 2014 we were e-mailed by Mr and Mrs. J Fournier who, having owned a basement apartment in Slough in May 1997. The dilemma was if we could estimate the compensation to the landlord would likely be for a ninety year extension to my lease. Comparative residencies in Slough with 100 year plus lease were worth £201,200. The mid-range ground rent payable was £55 collected per annum. The lease ended in 2082. Considering the 56 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £31,400 and £36,200 plus costs.
In 2014 we were called by Ms Emma Rogers who, having purchased a first floor apartment in Slough in August 2008. The dilemma was if we could shed any light on how much (roughly) premium would likely be to prolong the lease by 90 years. Similar flats in Slough with a long lease were in the region of £300,000. The average amount of ground rent was £50 billed yearly. The lease terminated on 4 May 2102. Given that there were 76 years as a residual term we approximated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 not including expenses.