The re-sale value of a leasehold property in Bishopston depends on how many years the lease has remaining. If it is near to or fewer than eighty years you should expect difficulties on re-sale, so it is advisable to arrange for a lease extension ahead of buying. Ideally one should start the lease extension process when the lease still has 82 years unexpired so that a lease extension can be addressed prior to the 80 year threshold. Current legislation enables Bishopston qualifying lessees to obtain a lease extension of 90 years in addition to the remaining length of the lease at a peppercorn rent (that is, rent free). The purpose of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold properties in Bishopston with over 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little upside in buying 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 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
Regardless of whether you are a tenant or a landlord in Bishopston,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 Bishopston valuers.
Ollie was the the leasehold proprietor of a studio apartment in Bishopston being marketed with a lease of fraction over 59 years unexpired. Ollie on an informal basis approached his landlord being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent initially set at £200 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Ollie to invoke his statutory right. Ollie obtained expert legal guidance and was able to make a more informed judgement and deal with the matter and ending up with a market value flat.
Mr and Mrs. Y Campbell owned a purpose-built flat in Bishopston in August 1995. The dilemma was if we could shed any light on how much (roughly) price would be to extend the lease by 90 years. Comparative premises in Bishopston with 100 year plus lease were valued about £285,000. The average ground rent payable was £55 billed monthly. The lease concluded on 21 January 2105. Considering the 80 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £12,400 and £14,200 not including fees.
Dr F King completed a one bedroom flat in Bishopston in August 2003. The question was if we could shed any light on how much (roughly) compensation to the landlord could be for a 90 year lease extension. Similar homes in Bishopston with 100 year plus lease were worth £200,800. The mid-range ground rent payable was £65 collected per annum. The lease came to a finish in 2085. Considering the 60 years as a residual term we approximated the premium to the landlord to extend the lease to be within £20,900 and £24,200 plus expenses.