For anyone whose Shirehampton home is held on a long lease, the message is clear – if you ignore the situation, the property will eventually revert to your landlord, leaving you empty-handed. The shorter the lease the less it is worth and the more expensive it will be to extend the lease.
Leasehold residencies in Shirehampton with more than one hundred years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and maintenance 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. |
| Halifax | Minimum 70 years from the date 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Shirehampton,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Shirehampton valuers.
18 months ago Zachary, came precariously near to the 80-year mark with the lease on his one bedroom apartment in Shirehampton. Having purchased his home two decades ago, the unexpired term was of little importance. Fortunately, he realised he would soon be paying an inflated amount for a lease extension. Zachary extended the lease at the eleventh hour last January. Zachary and the landlord eventually agreed on the final figure of £6,000 . If the lease had slipped below eighty years, the sum would have become more exhorbitant by at least £1,075.
Last Spring we were approach by Mrs G Young , who completed a studio apartment in Shirehampton in March 1995. The dilemma was if we could approximate the compensation to the landlord would likely be for a ninety year lease extension. Similar properties in Shirehampton with 100 year plus lease were worth £183,600. The average ground rent payable was £65 invoiced per annum. The lease came to a finish in 2082. Taking into account 57 years as a residual term we estimated the premium to the landlord to extend the lease to be between £28,500 and £33,000 not including fees.
Mr Ali Edwards purchased a one bedroom flat in Shirehampton in September 1997. We are asked if we could shed any light on how much (approximately) price would likely be to prolong the lease by 90 years. Similar residencies in Shirehampton with an extended lease were worth £245,000. The mid-range amount of ground rent was £45 billed annually. The lease finished on 25 January 2093. Considering the 68 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of legals.