The market value of Gunnislake leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can escalate substantially once the remaining term is below than 80 years
It is generally considered that a residential leasehold with in excess of one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to any lease with more than 30 years left, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service gives you increased control over the value of your Gunnislake leasehold, as your property will be more valuable and saleable in terms 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.
Last October Joshua, came precariously near to the 80-year mark with the lease on his purpose- built flat in Gunnislake. Having bought his home two decades ago, the unexpired term was of minimal importance. Thankfully, he recognised he would soon be paying way over the odds for Extending the lease. Joshua arranged for a lease extension at the eleventh hour last August. Joshua and the landlord in the end settled on sum of £5,000 . If the lease had dropped lower than eighty years, the sum would have escalated by at least £900.
In 2011 we were contacted by Mr and Mrs. P Wood who, having purchased a purpose-built flat in Gunnislake in January 2011. The dilemma was if we could approximate the premium could be for a 90 year extension to my lease. Comparable residencies in Gunnislake with 100 year plus lease were worth £193,400. The mid-range ground rent payable was £65 invoiced every twelve months. The lease ended on 15 October 2084. Taking into account 59 years left we calculated the compensation to the freeholder to extend the lease to be between £21,900 and £25,200 plus legals.
Mr and Mrs. T Simon bought a garden apartment in Gunnislake in June 2008. We are asked if we could estimate the compensation to the landlord could be to prolong the lease by ninety years. Comparable homes in Gunnislake with an extended lease were valued about £255,000. The mid-range amount of ground rent was £50 billed annually. The lease end date was in 2095. Given that there were 70 years left we approximated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 plus expenses.