For those whose Aylsham flat is held on a long lease, our message is clear – if nothing is done, the property will eventually revert to the freeholder, leaving you empty-handed. The fewer the years remaining the lower the value of the property and the more expensive it will be to extend the lease.
It is generally accepted that a residential leasehold with in excess of one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Engaging our service gives you better control over the value of your Aylsham leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Caleb owned a studio apartment in Aylsham being sold with a lease of a little over sixty years unexpired. Caleb on an informal basis approached his landlord being a well known Bristol-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent to start with set at £150 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Caleb to invoke his statutory right. Caleb obtained expert legal guidance and was able to make an informed judgement and deal with the matter and readily saleable.
Mr V Nelson took over the lease of a basement apartment in Aylsham in January 2010. We are asked if we could estimate the price would likely be to extend the lease by ninety years. Comparative residencies in Aylsham with 100 year plus lease were worth £176,200. The average ground rent payable was £65 billed yearly. The lease ran out on 22 January 2081. Taking into account 56 years as a residual term we calculated the compensation to the freeholder to extend the lease to be within £29,500 and £34,000 plus fees.
In 2009 we were contacted by Ms Bethan Lefèvre who, having moved into a first floor flat in Aylsham in July 1999. We are asked if we could estimate the premium would be to extend the lease by 90 years. Identical premises in Aylsham with a long lease were valued about £242,600. The average ground rent payable was £45 collected quarterly. The lease ran out on 28 February 2092. Having 67 years unexpired we approximated the compensation to the freeholder to extend the lease to be between £11,400 and £13,200 plus professional charges.