Ely residential property owned on a long lease is a wasting asset as the leaseholder only owns the property for a set term.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be worth the same as a freehold for decades to come.
| 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 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Irrespective of whether you are a tenant or a freeholder in Ely,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Ely valuers.
Off the back of unsuccessful discussions with the freeholder of her garden apartment in Ely, Catherine started the lease extension process as the eighty year mark was quickly coming. The lease extension completed in September 2006. The freeholder’s fees were negotiated to under 500 GBP.
Last Spring we were e-mailed by Dr Ibrahim Gunderson , who completed a newly refurbished flat in Ely in June 1998. The question was if we could shed any light on how much (approximately) price could be to extend the lease by ninety years. Comparable flats in Ely with 100 year plus lease were valued around £300,000. The mid-range amount of ground rent was £50 billed every twelve months. The lease termination date was on 18 July 2102. Considering the 76 years left we calculated the compensation to the landlord for the lease extension to be within £8,600 and £9,800 exclusive of professional charges.
Last Summer we were called by Dr K Carter , who owned a basement flat in Ely in April 2008. We are asked if we could shed any light on how much (approximately) price could be for a ninety year lease extension. Comparative residencies in Ely with 100 year plus lease were valued about £257,800. The average ground rent payable was £65 collected quarterly. The lease terminated in 2091. Given that there were 65 years unexpired we approximated the compensation to the landlord for the lease extension to be within £18,100 and £20,800 not including professional charges.