On the balance of probabilities if you own a flat in Ferndown you actually own a long leasehold interest over your property
It is generally considered that a residential leasehold with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to any lease with more than 45 years left, the residence will be equivalent in value to a freehold for many years ahead.
| 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; |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Engaging our service will provide you better control over the value of your Ferndown leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Samuel was the the leasehold proprietor of a conversion flat in Ferndown being sold with a lease of a few days over sixty years outstanding. Samuel on an informal basis contacted his freeholder being a well known Bristol-based freehold company for a lease extension. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £150 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Samuel to exercise his statutory right. Samuel procured expert advice and secured an acceptable resolution without resorting to tribunal and ending up with a market value flat.
Dr Henry Leroy completed a recently refurbished flat in Ferndown in June 1997. The dilemma was if we could estimate the price would be for a 90 year lease extension. Similar properties in Ferndown with a long lease were valued around £248,000. The mid-range amount of ground rent was £65 invoiced yearly. The lease termination date was on 11 September 2089. Taking into account 63 years outstanding we calculated the compensation to the landlord to extend the lease to be within £20,000 and £23,000 plus costs.
Ms C Parker was assigned a lease of a newly refurbished apartment in Ferndown in October 2004. The question was if we could approximate the compensation to the landlord could be to prolong the lease by an additional years. Similar properties in Ferndown with 100 year plus lease were worth £181,600. The average ground rent payable was £55 billed quarterly. The lease finished in 2078. Given that there were 52 years as a residual term we estimated the compensation to the freeholder for the lease extension to be between £30,400 and £35,200 not including legals.