The market value of a leasehold property in Harrold is impacted by how long the lease has left to run. If it is close to or fewer than 80 years you should foresee problems on re-sale, so it is recommended to arrange for the lease to be extended prior to buying. It is preferable to start the process of extending the lease is when a lease still has 82 years to run so that formalities can be finalised ahead of the 80 year cut off point. Statute enables Harrold qualifying lessees to acquire a new lease which will be for the balance of the existing lease plus a supplemental term of 90 years. The reason of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold premises in Harrold with more than one hundred years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges warrant it.
| 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. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
Retaining our service will provide you increased control over the value of your Harrold leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Last year Jack, came critically near to the eighty-year threshold with the lease on his studio flat in Harrold. In buying his flat twenty years previously, the length of the lease was of little concern. Thankfully, he realised he needed to take steps soon on Extending the lease. Jack arranged for a lease extension just in the nick of time in September. Jack and the landlord ultimately agreed on an amount of £5,500 . If the lease had fallen lower than eighty years, the figure would have escalated by a minimum £975.
In 2011 we were e-mailed by Mr and Mrs. M Wood who, having purchased a first floor apartment in Harrold in April 2008. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be to extend the lease by 90 years. Identical premises in Harrold with a long lease were worth £260,000. The average ground rent payable was £50 invoiced monthly. The lease ended on 21 February 2097. Having 72 years remaining we estimated the premium to the landlord for the lease extension to be within £9,500 and £11,000 not including fees.
Last Summer we were e-mailed by Mrs Louise Torres , who purchased a purpose-built apartment in Harrold in February 1996. We are asked if we could approximate the compensation to the landlord could be to extend the lease by an additional years. Comparable residencies in Harrold with a long lease were valued around £256,600. The mid-range amount of ground rent was £60 collected annually. The lease lapsed in 2077. Taking into account 52 years unexpired we approximated the premium to the landlord for the lease extension to be within £39,000 and £45,000 not including professional charges.