The market value of Admaston 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 substantially once the unexpired lease term is less than 80 years
Leasehold properties in Admaston with in excess of 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value 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 merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Chelsea 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. |
| 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. |
| 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. |
Irrespective of whether you are a tenant or a landlord in Admaston,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Admaston valuers.
Two years ago Lewis, came dangerously close to the eighty-year threshold with the lease on his studio flat in Admaston. Having bought his flat two decades ago, the lease term was of little importance. Fortunately, he became aware that he would imminently be paying an escalated premium for a lease extension. Lewis arranged for a lease extension just ahead of time in July. Lewis and the freeholder via the managing agents in the end agreed on an amount of £5,000 . If the lease had fallen to less than 80 years, the amount would have escalated by at least £925.
Last Autumn we were contacted by Mr James François , who purchased a one bedroom apartment in Admaston in November 2004. We are asked if we could approximate the compensation to the landlord could be for a ninety year lease extension. Similar flats in Admaston with an extended lease were worth £275,000. The average ground rent payable was £55 collected quarterly. The lease finished in 2102. Taking into account 77 years unexpired we approximated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 exclusive of costs.
In 2014 we were approached by Mr M García who, having completed a ground floor apartment in Admaston in March 1995. The dilemma was if we could approximate the price would likely be to prolong the lease by a further 90 years. Comparable premises in Admaston with 100 year plus lease were valued about £183,600. The mid-range amount of ground rent was £65 invoiced per annum. The lease elapsed on 6 June 2082. Taking into account 57 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £28,500 and £33,000 exclusive of expenses.