The value of Egremont leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can escalate significantly once the unexpired lease term is less than eighty years
It is conventional wisdom that a residential leasehold with in excess of one hundred years remaining is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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. |
| 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. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Regardless of whether you are a tenant or a landlord in Egremont,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Egremont valuers.
Logan owned a conversion apartment in Egremont on the market with a lease of a few days over 72 years outstanding. Logan on an informal basis contacted his landlord being a well known Manchester-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent to start with set at £150 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Logan to invoke his statutory right. Logan 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.
Mr and Mrs. S Dupont moved into a studio apartment in Egremont in May 1999. The question was if we could estimate the premium could be for a 90 year extension to my lease. Similar homes in Egremont with a long lease were valued about £252,800. The mid-range ground rent payable was £65 invoiced annually. The lease elapsed in 2091. Having 65 years unexpired we estimated the premium to the freeholder to extend the lease to be between £17,100 and £19,800 exclusive of legals.
Last Summer we were contacted by Mr Jason Cooper , who moved into a newly refurbished flat in Egremont in August 1999. The question was if we could estimate the premium could be for a 90 year extension to my lease. Comparative residencies in Egremont with a long lease were worth £191,400. The average ground rent payable was £55 invoiced every twelve months. The lease ran out in 2080. Considering the 54 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £34,200 and £39,600 not including professional charges.