The market value of Acocks Green 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 increase significantly 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 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 |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service gives you enhanced control over the value of your Acocks Green leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last year Aarav, came dangerously near to the eighty-year mark with the lease on his studio flat in Acocks Green. Having purchased his property 18 years ago, the unexpired term was of no relevance. by good luck, he became aware that he would imminently be paying an inflated amount for a lease extension. Aarav was able to extend his lease just under the wire in May. Aarav and the freeholder ultimately settled on an amount of £5,000 . If the lease had slipped to less than eighty years, the amount would have become more costly by at least £1,150.
Last Winter we were contacted by Dr T Sánchez , who completed a studio flat in Acocks Green in November 2004. The question was if we could estimate the price would be to prolong the lease by ninety years. Identical homes in Acocks Green with 100 year plus lease were worth £264,000. The average ground rent payable was £60 invoiced quarterly. The lease concluded in 2079. Taking into account 53 years outstanding we approximated the premium to the landlord for the lease extension to be within £37,100 and £42,800 plus legals.
Mr and Mrs. H Girard took over the lease of a basement apartment in Acocks Green in March 1999. The dilemma was if we could estimate the compensation to the landlord would likely be for a ninety year extension to my lease. Comparable residencies in Acocks Green with an extended lease were valued around £225,400. The mid-range ground rent payable was £45 collected annually. The lease finished in 2090. Having 64 years as a residual term we calculated the compensation to the landlord for the lease extension to be within £15,200 and £17,600 not including costs.