Ashbourne residential property held on a long lease is a depreciating asset because a leaseholder merely owns the property for a period of years.
It is conventional wisdom that a residential leasehold with more than 100 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 |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Regardless of whether you are a tenant or a freeholder in Ashbourne,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Ashbourne valuers.
In the wake of eight months of lengthy negotiations with the landlord of her garden flat in Ashbourne, Ellie started the lease extension process just as the lease was approaching the critical 80-year deadline. The legal work was finalised in May 2007. The freeholder’s fees were negotiated to about 700 pounds.
Dr N Díaz purchased a purpose-built flat in Ashbourne in November 2003. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be for a ninety year lease extension. Identical flats in Ashbourne with a long lease were worth £223,400. The mid-range ground rent payable was £60 billed per annum. The lease lapsed on 6 November 2084. Taking into account 59 years outstanding we approximated the premium to the freeholder for the lease extension to be within £27,600 and £31,800 exclusive of fees.
In 2009 we were phoned by Ms Abigail Nguyen who, having moved into a ground floor apartment in Ashbourne in September 2010. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be for a 90 year extension to my lease. Similar flats in Ashbourne with 100 year plus lease were valued about £205,000. The mid-range amount of ground rent was £50 collected annually. The lease expiry date was in 2104. Considering the 79 years unexpired we calculated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 plus legals.