Unfortunately that a Farnham Royal 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 early years due to the loss of value being disguised by increases in the Farnham Royal property market.Once your lease nears 85ish years, you should start thinking about 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 slips lower than 80 years - otherwise a higher amount will be due. Most flat owners in Farnham Royal will be able to extend under the legislation; however a lawyer should be able to confirm whether you qualify for an extension. In some situations you may not be entitled. There are also strict timetables and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancer for the duration of the process.
Leasehold properties in Farnham Royal with over one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Engaging our service will provide you enhanced control over the value of your Farnham Royal leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Luca was the the leasehold owner of a studio apartment in Farnham Royal on the market with a lease of just over 72 years unexpired. Luca informally spoke with his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £200 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Luca to exercise his statutory right. Luca obtained expert advice and secured an acceptable deal informally and ending up with a market value flat.
Dr B Moore completed a ground floor flat in Farnham Royal in July 1998. We are asked if we could estimate the premium would be for a ninety year lease extension. Similar properties in Farnham Royal with an extended lease were in the region of £254,200. The average amount of ground rent was £60 collected yearly. The lease came to a finish in 2076. Taking into account 51 years left we estimated the compensation to the freeholder for the lease extension to be between £43,700 and £50,600 plus costs.
Mr and Mrs. V Scott owned a garden apartment in Farnham Royal in August 2002. We are asked if we could shed any light on how much (roughly) premium would likely be to prolong the lease by a further 90 years. Comparable premises in Farnham Royal with an extended lease were worth £215,600. The average ground rent payable was £45 invoiced quarterly. The lease expired in 2087. Considering the 62 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £18,100 and £20,800 not including fees.