The re-sale value of a leasehold property in Farnham Royal depends on how many years the lease has remaining. If it is close to or fewer than 80 years you should expect difficulties on re-sale, so it is recommended to arrange for the lease to be extended ahead of buying. It is preferable to start the lease extension process when a lease still has 82 years to run so that formalities can be finalised in advance of the 80 year mark. Leasehold Reform legislation entitles Farnham Royal qualifying lessees to a 90 year extension added to their residual lease term (ie if your lease has 50 years left the statutory lease extension will provide a new term of 140 years). The purpose of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is generally accepted that a property with over one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years unexpired, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Chelsea 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. |
| Coventry Building Society | 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
Using our service gives you better control over the value of your Farnham Royal leasehold, as your property will be more valuable and saleable in respect of lease length should you decide to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Freddie, started to get near to the eighty-year threshold with the lease on his purpose- built apartment in Farnham Royal. In buying his home two decades ago, the lease term was of little relevance. by good luck, he noticed he needed to take steps soon on Extending the lease. Freddie extended the lease just in the nick of time last May. Freddie and the freeholder via the management company subsequently agreed on sum of £5,500 . If the lease had slipped below eighty years, the premium would have increased by a minimum £1,100.
Last year we were phoned by Mrs R Petit , who acquired a recently refurbished apartment in Farnham Royal in April 1997. The dilemma was if we could approximate the compensation to the landlord would likely be to prolong the lease by ninety years. Identical properties in Farnham Royal with an extended lease were worth £227,800. The mid-range ground rent payable was £45 collected annually. The lease finished in 2090. Having 65 years outstanding we estimated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 plus legals.
Last Summer we were contacted by Ms N Bonnet , who acquired a studio apartment in Farnham Royal in October 2006. The dilemma was if we could approximate the premium would likely be for a 90 year lease extension. Comparable residencies in Farnham Royal with a long lease were valued around £270,000. The average ground rent payable was £55 invoiced annually. The lease finished in 2101. Having 76 years unexpired we estimated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 exclusive of fees.