The market value of Parkstone 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 materialy once the unexpired lease term is less than eighty years
It is generally accepted that a residential leasehold with more than 100 years remaining is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset 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. |
The conveyancers that we work with procure Parkstone lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Joshua was the the leasehold owner of a high value flat in Parkstone on the market with a lease of a little over 72 years remaining. Joshua on an informal basis approached his freeholder a well known local-based freehold company for a lease extension. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £200 per annum. Ordinarily, ground rent would not be due on a lease extension were Joshua to exercise his statutory right. Joshua obtained expert advice and secured satisfactory deal informally and sell the property.
Last Winter we were phoned by Dr O Fournier , who completed a garden apartment in Parkstone in February 1999. We are asked if we could estimate the price would be for a 90 year lease extension. Similar properties in Parkstone with an extended lease were worth £218,000. The average amount of ground rent was £45 billed per annum. The lease finished on 8 September 2088. Considering the 63 years outstanding we approximated the compensation to the landlord to extend the lease to be between £17,100 and £19,800 plus expenses.
Last Christmas we were approach by Mr Muhammad Clark , who took over the lease of a studio apartment in Parkstone in March 2006. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be to extend the lease by ninety years. Identical premises in Parkstone with 100 year plus lease were valued about £265,000. The mid-range amount of ground rent was £55 collected yearly. The lease concluded in 2099. Considering the 74 years as a residual term we estimated the premium to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of fees.