Unfortunately that a Christchurch residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the Christchurch property market.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. If lease term falls under eighty years, you will end up paying 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property Most leasehold owners in Christchurch will be able to extend under the legislation; however a conveyancer should be able to clarify whether you qualify for an extension. In some situations you may not qualify. There are also strict timeframes and procedures to follow once the process is instigated and you will need to be guided by your lawyer throughout the formalities.
Leasehold premises in Christchurch with over 100 years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | 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. |
| 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 |
| 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 procure 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 conveyancer we work with provide it.
In the wake of eight months of protracted negotiations with the landlord of her purpose-built apartment in Christchurch, Rhiannon commenced the lease extension process as the eighty year deadline was quickly coming. The legal work was finalised in June 2005. The freeholder’s fees were negotiated to a tad over 500 GBP.
Dr O Young moved into a recently refurbished flat in Christchurch in March 2012. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would be for a 90 year extension to my lease. Comparable flats in Christchurch with an extended lease were valued around £235,200. The mid-range amount of ground rent was £45 billed annually. The lease elapsed on 23 February 2091. Given that there were 66 years left we estimated the premium to the freeholder to extend the lease to be within £12,400 and £14,200 plus expenses.
In 2013 we were contacted by Mr and Mrs. D Mercier who, having owned a purpose-built apartment in Christchurch in April 2000. The dilemma was if we could estimate the price would be for a ninety year lease extension. Comparative flats in Christchurch with an extended lease were worth £275,000. The mid-range ground rent payable was £55 invoiced monthly. The lease ran out on 19 November 2102. Given that there were 77 years left we approximated the premium to the freeholder for the lease extension to be within £13,300 and £15,400 plus fees.