The re-sale value of a leasehold property in Bishop Auckland depends on how long the lease has remaining. If it is near to or fewer than 80 years you should foresee difficulties on re-sale, so it is recommended to arrange for a lease extension prior to buying. Ideally one should start the process of extending the lease is when the lease still has 82 years to run so that a lease extension can be finalised prior to the 80 year threshold. Leasehold Reform legislation entitles Bishop Auckland qualifying lessees to acquire a lease extension of 90 years on top of the remaining length of the lease at a peppercorn rent (that is, rent free). The reason of the valuation is to determine the amount payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a residential leasehold with more than one hundred years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| 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; |
| Chelsea 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. |
| 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. |
| 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 |
Lease extensions in Bishop Auckland can be a difficult process. We recommend you get professional help from a conveyancing solicitor and valuer with experience in lease extensions.
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 Bishop Auckland lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Twenty four months ago Jack, started to get close to the eighty-year threshold with the lease on his garden flat in Bishop Auckland. Having bought his home 19 years previously, the length of the lease was of little importance. Thankfully, he recognised he needed to take action soon on Extending the lease. Jack extended the lease at the eleventh hour in May. Jack and the landlord who owned the flat above eventually agreed on sum of £5,000 . If he not met the deadline, the price would have escalated by a minimum £925.
In 2009 we were approached by Dr W Martinez who, having moved into a purpose-built flat in Bishop Auckland in April 2009. The question was if we could approximate the compensation to the landlord would be for a ninety year lease extension. Identical residencies in Bishop Auckland with an extended lease were in the region of £189,000. The mid-range amount of ground rent was £55 billed monthly. The lease finished in 2078. Taking into account 53 years left we calculated the compensation to the landlord for the lease extension to be within £28,500 and £33,000 plus legals.
Last Winter we were called by Dr J Collins , who purchased a recently refurbished flat in Bishop Auckland in January 2002. The question was if we could shed any light on how much (roughly) premium would likely be for a ninety year lease extension. Comparable premises in Bishop Auckland with a long lease were in the region of £290,000. The mid-range amount of ground rent was £45 collected every twelve months. The lease expiry date was in 2098. Taking into account 73 years left we estimated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of costs.