For anyone whose Princes Risborough flat is held on a long lease, our message is clear – if you ignore the situation, your property will eventually revert to the freeholder, leaving you empty-handed. The fewer the years remaining the lower the value of the property and the more expensive it will be to obtain a lease extension.
Leasehold properties in Princes Risborough with over 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 upside in buying the reversionary interest unless savings on ground rent and estate charges merit 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. |
| 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; |
| 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Retaining our service will provide you increased control over the value of your Princes Risborough leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Ali owned a conversion apartment in Princes Risborough being marketed with a lease of just over 61 years remaining. Ali on an informal basis contacted his freeholder being a well known local-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent to start with set at £100 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Ali to invoke his statutory right. Ali obtained expert advice and secured satisfactory resolution without resorting to tribunal and sell the flat.
In 2014 we were phoned by Mr Adam Hall who, having moved into a recently refurbished apartment in Princes Risborough in April 1998. We are asked if we could approximate the compensation to the landlord would be to prolong the lease by an additional years. Similar homes in Princes Risborough with an extended lease were worth £176,200. The average ground rent payable was £65 invoiced quarterly. The lease came to a finish on 10 April 2082. Given that there were 56 years unexpired we calculated the compensation to the freeholder to extend the lease to be within £29,500 and £34,000 exclusive of costs.
Ms Paige Peterson took over the lease of a garden apartment in Princes Risborough in April 2002. We are asked if we could shed any light on how much (roughly) price would be to prolong the lease by a further 90 years. Comparable residencies in Princes Risborough with an extended lease were valued around £237,600. The mid-range amount of ground rent was £45 collected quarterly. The lease elapsed on 23 January 2093. Considering the 67 years unexpired we calculated the premium to the landlord for the lease extension to be between £11,400 and £13,200 plus costs.