The value of Chesham leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can increase materialy once the unexpired lease term is below than 80 years
It is conventional wisdom that a property with over 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
Lender | Requirement |
---|---|
Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
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. |
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. |
Yorkshire 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. |
Lease extensions in Chesham can be a difficult process. We recommend you obtain guidance from a lawyer 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 dealing with Chesham lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In the wake of eight months of protracted correspondence with the landlord of her purpose-built flat in Chesham, Molly started the lease extension process just as the lease was coming close to the all-important 80-year threshold. The lease extension was concluded in September 2011. The freeholder’s charges were kept to an absolute minimum.
Dr Y Clarke completed a basement apartment in Chesham in September 2010. We are asked if we could shed any light on how much (roughly) premium could be to extend the lease by ninety years. Similar homes in Chesham with an extended lease were in the region of £280,000. The mid-range ground rent payable was £55 billed per annum. The lease ended on 1 September 2103. Having 79 years as a residual term we approximated the premium to the freeholder to extend the lease to be within £12,400 and £14,200 not including costs.
In 2012 we were contacted by Mr Ryan Lambert who, having owned a purpose-built flat in Chesham in August 2009. The dilemma was if we could estimate the premium could be to prolong the lease by 90 years. Comparative properties in Chesham with 100 year plus lease were in the region of £193,400. The mid-range ground rent payable was £65 billed per annum. The lease elapsed in 2083. Considering the 59 years remaining we approximated the compensation to the freeholder to extend the lease to be within £21,900 and £25,200 exclusive of professional charges.