Christchurch leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Christchurch residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Christchurch you should see if your lease has between 70 and ninety years left. In particular once the remaining lease term slips under eighty years, the cost of any lease extension sharply increases as part of the premium you pay is what is known as a marriage value
Leasehold premises in Christchurch 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 premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 |
Irrespective of whether you are a tenant or a freeholder in Christchurch,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Christchurch valuers.
Harrison owned a conversion flat in Christchurch being marketed with a lease of a little over 72 years left. Harrison informally spoke with his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent initially set at £100 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Harrison to exercise his statutory right. Harrison obtained expert legal guidance and secured an acceptable resolution without resorting to tribunal and sell the flat.
Dr Jake Ward purchased a newly refurbished flat in Christchurch in July 2012. We are asked if we could shed any light on how much (approximately) premium would be for a ninety year extension to my lease. Similar properties in Christchurch with an extended lease were valued about £210,600. The mid-range amount of ground rent was £45 collected per annum. The lease ended on 11 November 2087. Having 62 years remaining we approximated the compensation to the freeholder for the lease extension to be between £18,100 and £20,800 not including costs.
Dr Andrew Bennett bought a garden apartment in Christchurch in November 1995. We are asked if we could estimate the compensation to the landlord would likely be to extend the lease by a further 90 years. Comparative premises in Christchurch with 100 year plus lease were valued about £260,000. The mid-range amount of ground rent was £50 billed quarterly. The lease came to a finish in 2098. Considering the 73 years left we estimated the premium to the landlord to extend the lease to be within £9,500 and £11,000 exclusive of expenses.