Millom leases on residential properties are gradually diminishing 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. It is the case that most Millom tenants have the right to extend their lease by an additional ninety years in accordance with the 1993 Leasehold Reform Act. If you are a leasehold owner in Millom you should see if your lease has between 70 and ninety years left. In particular once the remaining lease term slips under 80 years, the cost of any lease extension increases dramatically as part of the premium you will incur is what is known as a marriage value
It is generally considered that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 45 years left, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
Regardless of whether you are a tenant or a landlord in Millom,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Millom valuers.
Following lengthy negotiations with the landlord of her garden flat in Millom, Alice initiated the lease extension process just as the lease was approaching the crucial 80-year mark. The lease extension completed in July 2009. The freeholder’s charges were kept to an absolute minimum.
Mr Gabriel Bailey bought a one bedroom apartment in Millom in April 1995. The question was if we could approximate the premium could be to prolong the lease by ninety years. Comparative flats in Millom with an extended lease were in the region of £280,000. The mid-range amount of ground rent was £55 collected quarterly. The lease lapsed in 2104. Given that there were 78 years remaining we approximated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 plus costs.
In 2012 we were approached by Mr and Mrs. G Bertrand who, having bought a garden flat in Millom in April 2000. The dilemma was if we could approximate the compensation to the landlord would be to extend the lease by ninety years. Comparable flats in Millom with a long lease were valued around £191,000. The mid-range ground rent payable was £65 collected monthly. The lease terminated on 24 March 2084. Considering the 58 years remaining we approximated the compensation to the landlord for the lease extension to be between £23,800 and £27,400 not including expenses.