The re-sale value of a leasehold property in Ladywood is impacted by how long the lease has left to run. If it is near to or less than 80 years you should expect difficulties on re-sale, so it is advisable to arrange for the lease to be extended prior to purchasing. It is preferable to commence the process of extending the lease is when the lease still has 82 years remaining so that all matters can be addressed ahead of the 80 year cut off point. Current legislation entitles Ladywood qualifying lessees to an additional term of 90 years on top of the unexpired term, at a peppercorn rent (zero ground rent). The intention of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold properties in Ladywood with over 100 years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Ladywood can be a difficult process. We recommend you secure guidance from a lawyer and surveyor with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Ladywood lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Evan was the the leasehold proprietor of a conversion apartment in Ladywood on the market with a lease of just over 59 years unexpired. Evan on an informal basis approached his freeholder being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £50 per annum. Ordinarily, ground rent would not be payable on a lease extension were Evan to exercise his statutory right. Evan procured expert advice and was able to make a more informed decision and handle with the matter and readily saleable.
Last year we were approach by Ms S Bernard , who took over the lease of a garden flat in Ladywood in August 2009. The question was if we could approximate the premium would likely be to extend the lease by 90 years. Comparative flats in Ladywood with an extended lease were valued around £265,000. The average amount of ground rent was £50 invoiced monthly. The lease terminated on 11 August 2099. Taking into account 73 years outstanding we calculated the premium to the landlord to extend the lease to be between £9,500 and £11,000 not including costs.
In 2013 we were approached by Mr and Mrs. A Jones who, having purchased a one bedroom flat in Ladywood in June 2008. The question was if we could approximate the premium would be for a ninety year extension to my lease. Similar flats in Ladywood with a long lease were valued around £264,000. The average amount of ground rent was £60 collected yearly. The lease came to a finish on 12 May 2079. Given that there were 53 years unexpired we approximated the compensation to the landlord for the lease extension to be within £37,100 and £42,800 plus expenses.