The market value of Ely 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 increase materialy once the remaining term is less than 80 years
Leasehold properties in Ely with in excess of one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
Lease extensions in Ely 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 procuring Ely lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last October Theo, started to get close to the eighty-year threshold with the lease on his first floor flat in Ely. In buying his property 18 years ago, the lease term was of minimal interest. Fortunately, he noticed he needed to take steps soon on Extending the lease. Theo extended the lease at the eleventh hour in March. Theo and the landlord ultimately agreed on sum of £6,000 . If the lease had slid to less than eighty years, the sum would have become more exhorbitant by at least £850.
Last month we were contacted by Mr and Mrs. K François , who took over the lease of a first floor apartment in Ely in June 2000. We are asked if we could estimate the compensation to the landlord would likely be to extend the lease by an additional years. Comparative premises in Ely with 100 year plus lease were worth £198,800. The mid-range ground rent payable was £55 collected every twelve months. The lease finished on 1 May 2079. Taking into account 55 years unexpired we estimated the premium to the landlord to extend the lease to be between £33,300 and £38,400 not including fees.
Dr Harry Mitchell bought a garden flat in Ely in October 2008. We are asked if we could approximate the price could be to extend the lease by ninety years. Comparative flats in Ely with an extended lease were worth £300,000. The average ground rent payable was £50 billed monthly. The lease terminated in 2099. Taking into account 75 years unexpired we calculated the premium to the landlord to extend the lease to be between £8,600 and £9,800 plus expenses.