The market value of a leasehold property in Chalfont St Giles depends on how many years the lease has left to run. If it is close to or fewer than 80 years you should anticipate problems on re-sale, so it is advisable to arrange for a lease extension prior to buying. Ideally one should start the process of extending the lease is when a lease still has 82 years unexpired so that a lease extension can be finalised ahead of the 80 year cut off point. Current legislation entitles Chalfont St Giles qualifying lessees to obtain a lease extension of 90 years on top of the remaining lease term 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 acquisition of the lease extension.
It is generally accepted that a residential leasehold with more than one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be worth the same as a freehold for many years ahead.
| 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; |
| 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. |
| Coventry Building Society | 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with procure Chalfont St Giles lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Nathaniel was the the leasehold proprietor of a 2 bedroom flat in Chalfont St Giles on the market with a lease of fraction over 72 years outstanding. Nathaniel on an informal basis spoke with his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £100 per annum and doubled every 25 years thereafter. No ground rent would be due on a lease extension were Nathaniel to exercise his statutory right. Nathaniel obtained expert legal guidance and was able to make a more informed judgement and handle with the matter and ending up with a market value flat.
In 2009 we were phoned by Mr and Mrs. M James who, having moved into a recently refurbished apartment in Chalfont St Giles in August 2007. The question was if we could shed any light on how much (approximately) premium could be to extend the lease by an additional years. Similar homes in Chalfont St Giles with an extended lease were worth £200,000. The average amount of ground rent was £50 collected monthly. The lease finished in 2104. Given that there were 78 years left we estimated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 plus fees.
Mr and Mrs. G González bought a newly refurbished flat in Chalfont St Giles in August 2004. The question was if we could estimate the price would likely be to extend the lease by an additional years. Comparable residencies in Chalfont St Giles with a long lease were worth £267,600. The average ground rent payable was £65 invoiced yearly. The lease end date was in 2093. Having 67 years unexpired we estimated the premium to the landlord for the lease extension to be within £14,300 and £16,400 not including professional charges.