The market value of South Brent 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 substantially once the unexpired lease term is below than eighty years
It is generally considered that a property with in excess of one hundred years remaining is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 45 years unexpired, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service will provide you increased control over the value of your South Brent leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
During the course of the last few months Edward, started to get near to the eighty-year mark with the lease on his basement apartment in South Brent. Having purchased his home two decades ago, the length of the lease was of no relevance. As luck would have it, he became aware that he would soon be paying an escalated premium for a lease extension. Edward arranged for a lease extension just ahead of time in July. Edward and the freeholder via the management company eventually agreed on a premium of £5,500 . If he not met the deadline, the premium would have increased by a minimum £1,100.
Dr M Alexander took over the lease of a recently refurbished flat in South Brent in November 2012. The dilemma was if we could shed any light on how much (approximately) price would be for a ninety year extension to my lease. Comparative premises in South Brent with 100 year plus lease were worth £285,000. The mid-range ground rent payable was £55 billed yearly. The lease expired in 2103. Having 79 years outstanding we calculated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 exclusive of expenses.
Dr Millie Petit completed a purpose-built apartment in South Brent in May 2006. The dilemma was if we could estimate the premium would likely be to prolong the lease by a further 90 years. Identical residencies in South Brent with an extended lease were valued around £193,400. The average ground rent payable was £65 billed every twelve months. The lease concluded in 2083. Considering the 59 years as a residual term we approximated the compensation to the freeholder for the lease extension to be between £21,900 and £25,200 exclusive of professional charges.