The re-sale value of a leasehold property in Rowen depends on how many years the lease has remaining. If it is close to or fewer than eighty years you should anticipate problems on re-sale, so it is recommended to arrange for the lease to be extended ahead of purchasing. It is preferable to start the lease extension process when the lease still has 82 years unexpired so that formalities can be finalised in advance of the 80 year mark. Current legislation enables Rowen qualifying lessees to acquire a new lease which will be for the balance of the existing lease plus a supplemental term of ninety years. The intention 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.
It is conventional wisdom that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| Yorkshire 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. |
The conveyancers that we work with handle Rowen 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.
Last October Arthur, started to get near to the eighty-year threshold with the lease on his ground floor flat in Rowen. In buying his property 19 years previously, the lease term was of no bearing. by good luck, it dawned on him that he needed to take action soon on a lease extension. Arthur was able to extend his lease at the eleventh hour last January. Arthur and the landlord eventually agreed on sum of £5,000 . If he had missed the deadline, the price would have escalated by a minimum £1,000.
Dr Molly Davis was assigned a lease of a studio apartment in Rowen in May 2007. The question was if we could approximate the compensation to the landlord would be to extend the lease by an additional years. Identical homes in Rowen with a long lease were worth £198,800. The average ground rent payable was £55 invoiced annually. The lease ran out on 10 October 2081. Given that there were 55 years unexpired we estimated the premium to the landlord for the lease extension to be within £33,300 and £38,400 exclusive of fees.
In 2010 we were approached by Mr and Mrs. E Reed who, having was assigned a lease of a studio apartment in Rowen in February 2008. We are asked if we could estimate the premium would be to extend the lease by an additional years. Comparative properties in Rowen with an extended lease were in the region of £300,000. The mid-range amount of ground rent was £50 invoiced yearly. The lease terminated in 2101. Considering the 75 years remaining we calculated the premium to the landlord to extend the lease to be between £9,500 and £11,000 plus fees.