Unfortunately that a Crowthorne residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the depreciation being disguised by increases in the Crowthorne property market.Once your lease nears 85ish years, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls lower than 80 years - otherwise a higher premium will be due. Most leasehold owners in Crowthorne will be able to extend under the legislation; however a lawyer will be able to confirm if you are eligibility. In some situations you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancing solicitor throughout the formalities.
It is conventional wisdom that a property with over one hundred years remaining is worth roughly the equivalent as a freehold. Where an further 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 |
|---|---|
| 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Using our service gives you better control over the value of your Crowthorne leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Jamie owned a conversion flat in Crowthorne on the market with a lease of fraction over fifty eight years outstanding. Jamie informally contacted his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £125 yearly. Ordinarily, ground rent would not be payable on a lease extension were Jamie to exercise his statutory right. Jamie obtained expert advice and was able to make a more informed decision and deal with the matter and sell the property.
Ms Abigail Rose completed a one bedroom flat in Crowthorne in June 2007. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be for a 90 year lease extension. Comparable flats in Crowthorne with 100 year plus lease were worth £270,000. The average ground rent payable was £55 invoiced monthly. The lease elapsed on 11 October 2100. Having 75 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 plus expenses.
In 2013 we were phoned by Mr and Mrs. H Bailey who, having was assigned a lease of a purpose-built flat in Crowthorne in July 2003. We are asked if we could approximate the price could be for a ninety year lease extension. Comparable residencies in Crowthorne with a long lease were in the region of £173,800. The mid-range amount of ground rent was £65 invoiced quarterly. The lease lapsed in 2080. Given that there were 55 years left we estimated the premium to the landlord for the lease extension to be within £31,400 and £36,200 plus expenses.