The market value of Forest Row leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can increase substantially once the unexpired lease term is less than eighty years
Leasehold residencies in Forest Row with in excess of one hundred years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Yorkshire 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. |
Irrespective of whether you are a tenant or a landlord in Forest Row,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Forest Row valuers.
Riley owned a conversion apartment in Forest Row on the market with a lease of fraction over 59 years outstanding. Riley on an informal basis approached his freeholder being a well known Manchester-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of an increased rent to £200 per annum. No ground rent would be due on a lease extension were Riley to exercise his statutory right. Riley procured expert legal guidance and secured satisfactory resolution informally and ending up with a market value flat.
Mrs Elizabeth Simon purchased a first floor flat in Forest Row in August 2008. The question was if we could shed any light on how much (roughly) compensation to the landlord could be for a ninety year extension to my lease. Comparable properties in Forest Row with 100 year plus lease were worth £205,000. The average amount of ground rent was £50 collected per annum. The lease ran out in 2103. Given that there were 79 years remaining we approximated the premium to the freeholder to extend the lease to be between £8,600 and £9,800 plus fees.
Last Summer we were e-mailed by Mr and Mrs. T Watson , who purchased a garden apartment in Forest Row in February 1995. The question was if we could estimate the price would be for a ninety year extension to my lease. Similar flats in Forest Row with 100 year plus lease were in the region of £275,000. The average amount of ground rent was £65 invoiced every twelve months. The lease came to a finish on 28 August 2092. Considering the 68 years remaining we estimated the premium to the freeholder to extend the lease to be within £13,300 and £15,400 plus legals.