The value of Adderbury leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can escalate significantly once the unexpired lease term is less than 80 years
Leasehold premises in Adderbury with more than 100 years unexpired on the lease are often referred to as ‘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 upside in buying the reversionary interest unless savings on ground rent and estate charges justify 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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 better control over the value of your Adderbury leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
After lengthy discussions with the landlord of her first floor apartment in Adderbury, Georgina initiated the lease extension process just as her lease was nearing the all-important eighty-year threshold. The legal work was concluded in November 2008. The landlord’s charges were restricted to under 550 pounds.
In 2010 we were contacted by Mr K Thomas who, having bought a studio apartment in Adderbury in February 1995. We are asked if we could estimate the premium could be for a 90 year extension to my lease. Comparative flats in Adderbury with a long lease were worth £250,000. The average amount of ground rent was £50 collected annually. The lease finished in 2094. Taking into account 69 years outstanding we approximated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of legals.
Dr B Morris was assigned a lease of a ground floor apartment in Adderbury in January 2010. We are asked if we could approximate the compensation to the landlord would likely be to extend the lease by 90 years. Similar properties in Adderbury with an extended lease were in the region of £290,000. The average amount of ground rent was £60 invoiced annually. The lease came to a finish on 18 October 2105. Taking into account 80 years remaining we calculated the compensation to the freeholder to extend the lease to be between £13,300 and £15,400 plus professional charges.