The re-sale value of a leasehold property in Clophill is impacted by how long the lease has remaining. If it is near to or less than 80 years you should envisage difficulties on re-sale, so it is recommended to arrange for a lease extension ahead of purchasing. It is ideal to start the lease extension process when a lease still has 82 years remaining so that a lease extension can be concluded well before the 80 year cut off point. Current legislation entitles Clophill qualifying lessees to an additional term of ninety years on top of the existing term, at a peppercorn rent (no ground rent). The intention of the valuation is to determine the amount payable by the lessee to the freeholder for the purchase of the lease extension.
It is generally accepted that a residential leasehold with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 35 years unexpired, the residence will be equivalent in value to a freehold for many years ahead.
Lender | Requirement |
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Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
Leeds Building Society | 85 years remaining from the start 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. |
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 |
Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service will provide you enhanced control over the value of your Clophill leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Aaron owned a conversion apartment in Clophill on the market with a lease of a few days over 72 years remaining. Aaron on an informal basis spoke with his freeholder a well known London-based freehold company for a lease extension. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £125 yearly. Ordinarily, ground rent would not be due on a lease extension were Aaron to invoke his statutory right. Aaron obtained expert legal guidance and secured satisfactory resolution without going to tribunal and sell the flat.
Last Summer we were called by Dr Zachary González , who purchased a ground floor apartment in Clophill in September 1996. We are asked if we could estimate the price could be to extend the lease by an additional years. Identical premises in Clophill with a long lease were valued about £166,400. The average amount of ground rent was £60 collected yearly. The lease expired in 2078. Given that there were 54 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £32,300 and £37,400 not including costs.
Dr Chelsea King moved into a one bedroom flat in Clophill in July 2006. We are asked if we could estimate the compensation to the landlord could be for a ninety year extension to my lease. Comparable flats in Clophill with 100 year plus lease were in the region of £227,800. The mid-range ground rent payable was £45 billed every twelve months. The lease finished on 3 August 2089. Given that there were 65 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £13,300 and £15,400 not including costs.