Owning a apartment usually means owning a lease of the property, which has a set term of years. your lease will normally be granted for a set period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Newcastle upon Tyne. Clearly, the length of lease remaining shortens as time goes by. This is often ignored and only raises itself as an issue when the flat or house needs to be sold or refinanced. The shorter the lease the lower the value of the property and the more expensive it will be to procure a lease extension. Eligible leaseholders in Newcastle upon Tyne have the legal entitlement to extend the lease for a further 90 years in accordance with the 1993 Leasehold Reform Act. Please give careful deliberation before delaying your Newcastle upon Tyne lease extension. Putting off that expense now likely increases the price you will ultimately incur to extend your lease
Leasehold premises in Newcastle upon Tyne with over one hundred years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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. |
| Godiva Mortgages | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
Lease extensions in Newcastle upon Tyne can be a difficult process. We recommend you secure professional help from a lawyer and surveyor with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring Newcastle upon Tyne lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Eliot owned a conversion apartment in Newcastle upon Tyne on the market with a lease of a little over 59 years remaining. Eliot informally approached his landlord being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent to start with set at £200 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Eliot to exercise his statutory right. Eliot procured expert legal guidance and was able to make a more informed judgement and deal with the matter and sell the property.
Last Spring we were phoned by Dr Ella Wood , who bought a garden flat in Newcastle upon Tyne in August 2003. We are asked if we could approximate the compensation to the landlord would likely be to extend the lease by 90 years. Similar properties in Newcastle upon Tyne with a long lease were valued around £264,000. The mid-range amount of ground rent was £60 invoiced yearly. The lease finished in 2078. Considering the 53 years left we estimated the compensation to the freeholder for the lease extension to be between £37,100 and £42,800 not including fees.
Last Summer we were called by Dr Edward Thompson , who took over the lease of a studio flat in Newcastle upon Tyne in July 2012. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be to prolong the lease by a further 90 years. Similar premises in Newcastle upon Tyne with 100 year plus lease were valued around £225,400. The mid-range ground rent payable was £45 billed annually. The lease expired on 25 July 2089. Considering the 64 years as a residual term we calculated the compensation to the landlord to extend the lease to be within £16,200 and £18,600 exclusive of costs.