As the the remaining lease term of a Christchurch residential lease diminished so does its value and therefore the value of your property. If the lease has, over 99 years remaining then this decrease may be fractional that being said there will become a point in time when a lease has under than 80 years left as part of the premium you will incur is what is known as a marriage value. This could increase markedly the cost. It is the primary rational as to why you should extend the lease sooner than later. Most flat owners in Christchurch will qualify for this right; that being said a conveyancing solicitor will be able to advise if you qualify to extend your lease. In certain situations you may not qualify, the most frequent reason being that you have owned the property for under two years.
It is conventional wisdom that a residential leasehold with more than 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years unexpired, the premises will be worth the same as a freehold for decades to come.
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 lawyers that we work with handle Christchurch 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.
16 months ago Daniel, started to get close to the 80-year threshold with the lease on his leasehold flat in Christchurch. In buying his home two decades ago, the unexpired term was of no importance. Luckily, it dawned on him that he would imminently be paying way over the odds for Extending the lease. Daniel extended the lease just under the wire last May. Daniel and the landlord who owned the flat above subsequently settled on a premium of £5,000 . If the lease had slid to less than 80 years, the sum would have increased by at least £950.
Mr and Mrs. D Roux completed a ground floor flat in Christchurch in January 1997. We are asked if we could approximate the premium would likely be to extend the lease by an additional years. Similar premises in Christchurch with 100 year plus lease were valued about £168,800. The average ground rent payable was £60 collected annually. The lease expired on 5 February 2081. Given that there were 55 years remaining we approximated the compensation to the landlord to extend the lease to be within £31,400 and £36,200 plus legals.
Last Christmas we were contacted by Mr and Mrs. A Richardson , who took over the lease of a garden apartment in Christchurch in July 2006. The dilemma was if we could approximate the premium would be for a 90 year lease extension. Comparable residencies in Christchurch with an extended lease were in the region of £235,200. The mid-range ground rent payable was £45 billed yearly. The lease expired in 2092. Taking into account 66 years remaining we approximated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 exclusive of professional charges.