The market value of a leasehold property in Alnmouth depends on how many years the lease has left to run. If it is close to or less than 80 years you should envisage problems on re-sale, so it is recommended to arrange for the lease to be extended before buying. It is ideal to start the lease extension process when the lease still has 82 years unexpired so that formalities can be finalised prior to the eighty year threshold. Current legislation enables Alnmouth qualifying lessees to a 90 year extension added to their residual lease term (ie if your lease has 50 years left the statutory lease extension will provide a new term of 140 years). The reason of the valuation is to determine the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold residencies in Alnmouth with in excess of 100 years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
Using our service will provide you enhanced control over the value of your Alnmouth leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
In 2014 Cameron, started to get near to the 80-year mark with the lease on his studio apartment in Alnmouth. Having purchased his property two decades ago, the lease term was of minimal significance. Luckily, he realised he would soon be paying way over the odds for Extending the lease. Cameron extended the lease just under the wire last January. Cameron and the landlord subsequently settled on sum of £5,500 . If the lease had dipped to less than 80 years, the amount would have become more costly by a minimum £925.
Mr and Mrs. C Flores bought a garden apartment in Alnmouth in May 1997. The dilemma was if we could shed any light on how much (roughly) premium would be to prolong the lease by 90 years. Comparable properties in Alnmouth with an extended lease were in the region of £166,400. The average amount of ground rent was £60 invoiced every twelve months. The lease terminated in 2080. Taking into account 54 years outstanding we approximated the premium to the freeholder for the lease extension to be between £32,300 and £37,400 exclusive of expenses.
Dr Jessica Girard moved into a one bedroom flat in Alnmouth in March 1998. The question was if we could approximate the premium would likely be to prolong the lease by 90 years. Comparative properties in Alnmouth with an extended lease were in the region of £227,800. The mid-range ground rent payable was £45 billed quarterly. The lease ran out in 2091. Given that there were 65 years remaining we approximated the compensation to the freeholder to extend the lease to be between £13,300 and £15,400 exclusive of professional charges.