Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will usually be granted for a prescribed period of time , usually 99 or 125 years, although we have come across longer and shorter terms in Chelmsley Wood. Inevitably, the period of lease left shortens over time. This is often ignored and only raises itself as an issue when the flat or house has to be disposed of or refinanced. The shorter the lease the lower the value of the property and the more it will cost to obtain a lease extension. Eligible long lease owners in Chelmsley Wood have the right to extend the lease for a further 90 years under the 1993 Leasehold Reform Act. Please give due attention before delaying your Chelmsley Wood lease extension. Holding off the cost now simply increases the price you will eventually have to pay for a lease extension
It is conventional wisdom that a residential leasehold with more than one hundred years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 45 years left, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with procure Chelmsley Wood 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.
Rory owned a studio flat in Chelmsley Wood on the market with a lease of a little over sixty years remaining. Rory informally contacted his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of an increased rent to £125 yearly. No ground rent would be due on a lease extension were Rory to invoke his statutory right. Rory obtained expert advice and secured satisfactory deal without going to tribunal and sell the property.
In 2010 we were called by Mr and Mrs. H Garcia who, having purchased a purpose-built apartment in Chelmsley Wood in October 2003. We are asked if we could approximate the compensation to the landlord would be for a 90 year lease extension. Similar residencies in Chelmsley Wood with an extended lease were worth £166,400. The average ground rent payable was £60 billed per annum. The lease ended on 26 September 2079. Taking into account 54 years left we estimated the premium to the freeholder for the lease extension to be between £32,300 and £37,400 not including costs.
In 2014 we were e-mailed by Mr and Mrs. C Alexander who, having took over the lease of a newly refurbished flat in Chelmsley Wood in May 2012. The dilemma was if we could approximate the compensation to the landlord would be to prolong the lease by a further 90 years. Similar premises in Chelmsley Wood with 100 year plus lease were valued about £227,800. The average amount of ground rent was £45 invoiced yearly. The lease expired on 21 October 2090. Given that there were 65 years outstanding we estimated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 exclusive of legals.