On the balance of probabilities where you own a flat in Dursley you actually own a long leasehold interest over your property
It is generally accepted that a residential leasehold with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | 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. |
Regardless of whether you are a tenant or a freeholder in Dursley,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Dursley valuers.
George owned a 2 bedroom flat in Dursley being marketed with a lease of a little over 59 years unexpired. George on an informal basis approached his freeholder being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £50 yearly. No ground rent would be due on a lease extension were George to invoke his statutory right. George procured expert legal guidance and secured an acceptable resolution informally and sell the flat.
In 2009 we were e-mailed by Dr Zoe Scott who, having bought a one bedroom flat in Dursley in September 1998. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be for a 90 year lease extension. Comparable properties in Dursley with a long lease were worth £232,800. The average ground rent payable was £45 invoiced yearly. The lease came to a finish in 2090. Given that there were 65 years as a residual term we approximated the compensation to the freeholder to extend the lease to be within £13,300 and £15,400 not including expenses.
Last August we were approach by Dr Nathaniel Collins , who completed a one bedroom flat in Dursley in March 2008. We are asked if we could shed any light on how much (approximately) premium could be to prolong the lease by ninety years. Similar premises in Dursley with an extended lease were worth £275,000. The mid-range amount of ground rent was £55 billed yearly. The lease came to a finish on 21 August 2101. Considering the 76 years outstanding we estimated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of expenses.