West Drayton residential property held on a long lease is a depreciating asset because a leaseholder merely owns the property for a period of years.
It is generally considered that a residential leasehold with over one hundred years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Retaining our service gives you increased control over the value of your West Drayton leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Half a year ago Mason, came precariously near to the 80-year threshold with the lease on his purpose- built flat in West Drayton. In buying his home twenty years previously, the lease term was of minimal concern. Thankfully, it dawned on him that he would imminently be paying way over the odds for a lease extension. Mason was able to extend his lease just in the nick of time in August. Mason and the landlord eventually agreed on a premium of £5,500 . If he failed to meet the deadline, the premium would have escalated by at least £1,125.
In 2014 we were approached by Ms H Simon who, having bought a basement flat in West Drayton in August 2008. The question was if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Identical properties in West Drayton with a long lease were valued about £290,000. The mid-range ground rent payable was £60 billed annually. The lease lapsed on 6 July 2104. Having 80 years outstanding we calculated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 exclusive of legals.
An example of a Freehold Enfranchisement decision for a West Drayton residence is 164 Nestles Avenue in October 2013. The tribunal agreed with the proposed price of £20,158 for the freehold and determined that that sum is the amount to be paid into court This case affected 2 flats. The unexpired term as at the valuation date was 69 years.