The value of Adderbury leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can escalate substantially once the remaining term is less than eighty years
It is conventional wisdom that a property with more than 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be worth the same as a freehold for decades to come.
| 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. |
| 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with handle Adderbury lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Eli was the the leasehold proprietor of a 2 bedroom flat in Adderbury being marketed with a lease of just over 61 years remaining. Eli informally approached his freeholder a well known London-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years subject to an increased rent to £100 annually. Ordinarily, ground rent would not be due on a lease extension were Eli to exercise his statutory right. Eli procured expert legal guidance and secured an acceptable deal informally and ending up with a market value flat.
Last year we were contacted by Mr B Ricardo , who completed a purpose-built apartment in Adderbury in August 2003. The question was if we could approximate the compensation to the landlord could be to prolong the lease by ninety years. Similar premises in Adderbury with 100 year plus lease were worth £270,000. The mid-range ground rent payable was £55 invoiced monthly. The lease expired on 6 September 2099. Having 74 years as a residual term we approximated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of professional charges.
Mr and Mrs. U Vincent owned a basement apartment in Adderbury in February 2004. We are asked if we could shed any light on how much (approximately) price would likely be to extend the lease by an additional years. Identical homes in Adderbury with 100 year plus lease were valued around £166,400. The average ground rent payable was £60 billed quarterly. The lease lapsed on 14 August 2079. Given that there were 54 years remaining we estimated the premium to the landlord for the lease extension to be between £32,300 and £37,400 plus expenses.