The re-sale value of a leasehold property in Allestree is impacted by how long the lease has remaining. If it is near to or less than eighty years you should foresee problems on re-sale, so it is advisable to arrange for the lease to be extended ahead of buying. Ideally one should start the lease extension process when a lease still has 82 years to run so that a lease extension can be addressed in advance of the eighty year cut off point. Leasehold Reform legislation entitles Allestree qualifying lessees to an additional term of 90 years over and above the existing term, at a peppercorn rent (zero ground rent). The purpose of the valuation is to determine the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold properties in Allestree with in excess of one hundred years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges justify it.
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Allestree can be a difficult process. We recommend you procure professional help from a conveyancing solicitor and surveyor well versed in the legislation and lease extension process.
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 a wealth of experience procuring Allestree lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In recent months Owen, started to get close to the 80-year threshold with the lease on his leasehold flat in Allestree. Having bought his flat twenty years previously, the unexpired term was of minimal interest. Thankfully, it dawned on him that he would soon be paying an inflated amount for Extending the lease. Owen arranged for a lease extension just ahead of time in June. Owen and the landlord who owned the flat above ultimately agreed on the final figure of £5,500 . If the lease had descended to less than eighty years, the amount would have gone up by at least £1,125.
In 2010 we were contacted by Mrs Alicia Robinson who, having was assigned a lease of a first floor flat in Allestree in April 2010. The dilemma was if we could approximate the compensation to the landlord would be for a 90 year lease extension. Similar flats in Allestree with a long lease were worth £210,000. The average ground rent payable was £50 collected per annum. The lease expired in 2106. Taking into account 80 years outstanding we estimated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 not including fees.
In 2013 we were called by Mr and Mrs. E Morgan who, having took over the lease of a ground floor flat in Allestree in February 2009. We are asked if we could approximate the compensation to the landlord would likely be to prolong the lease by a further 90 years. Comparable flats in Allestree with an extended lease were in the region of £275,000. The average ground rent payable was £45 collected quarterly. The lease finished on 18 October 2095. Given that there were 69 years remaining we approximated the compensation to the freeholder to extend the lease to be within £12,400 and £14,200 exclusive of legals.