Acle residential property held on a long lease is a wasting asset as the leaseholder merely owns the property for a period of years.
It is generally accepted that a residential leasehold with in excess of one hundred years remaining is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years ahead.
| 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. |
| 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Irrespective of whether you are a tenant or a landlord in Acle,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Acle valuers.
Twenty four months ago Jack, started to get close to the 80-year mark with the lease on his one bedroom flat in Acle. Having purchased his property two decades ago, the unexpired term was of little relevance. Fortunately, he noticed he needed to take steps soon on a lease extension. Jack arranged for a lease extension just under the wire last March. Jack and the freeholder via the managing agents subsequently settled on a premium of £5,000 . If the lease had slipped to less than eighty years, the sum would have become more costly by at least £850.
Last January we were e-mailed by Dr Abbie Scott , who bought a first floor apartment in Acle in November 2004. We are asked if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Comparable flats in Acle with a long lease were in the region of £246,800. The average ground rent payable was £60 invoiced every twelve months. The lease terminated on 9 October 2075. Considering the 50 years left we estimated the premium to the freeholder for the lease extension to be between £44,700 and £51,600 plus expenses.
Dr Oscar Jones completed a first floor flat in Acle in January 2010. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would be for a ninety year extension to my lease. Identical properties in Acle with 100 year plus lease were in the region of £203,200. The average amount of ground rent was £65 collected annually. The lease came to a finish on 14 September 2086. Given that there were 61 years as a residual term we estimated the compensation to the landlord to extend the lease to be between £20,000 and £23,000 plus expenses.