The value of Grange Park leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can escalate significantly once the remaining term is below than eighty years
Leasehold properties in Grange Park with more than 100 years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service will provide you better control over the value of your Grange Park leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
16 months ago Michael, started to get close to the 80-year mark with the lease on his first floor apartment in Grange Park. In buying his property two decades ago, the length of the lease was of little concern. Luckily, he recognised he would imminently be paying an escalated premium for Extending the lease. Michael arranged for a lease extension just under the wire in June. Michael and the freeholder eventually settled on sum of £5,000 . If he failed to meet the deadline, the premium would have increased by at least £1,150.
Last October we were called by Dr Nathaniel Taylor , who completed a studio apartment in Grange Park in June 2002. The dilemma was if we could approximate the premium could be for a ninety year lease extension. Comparable homes in Grange Park with a long lease were in the region of £176,200. The average amount of ground rent was £65 collected yearly. The lease terminated in 2082. Taking into account 56 years remaining we estimated the compensation to the freeholder to extend the lease to be between £29,500 and £34,000 plus costs.
An example of a Lease Extension matter before the tribunal for a Grange Park property is First Floor Flat 109 Lyndhurst Road in May 2010. Following a vesting order by Edmonton County Court on 29th October 2009 the Tribunal decided on a figure of £5,012 for a lease extension. This case was in relation to 1 flat. The unexpired lease term was 81.79 years.