Badminton residential property held on a long lease is a depreciating asset as the leaseholder merely owns the property for a set term.
Leasehold residencies in Badminton with over 100 years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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 better control over the value of your Badminton leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Following lengthy discussions with the landlord of her first floor apartment in Badminton, Emma started the lease extension process as the 80 year mark was quickly advancing. The transaction was concluded in August 2011. The freeholder’s charges were negotiated to slightly above 450 GBP.
Dr B Moore acquired a ground floor apartment in Badminton in July 2009. The question was if we could approximate the price would likely be to extend the lease by a further 90 years. Comparative residencies in Badminton with an extended lease were valued around £275,000. The average ground rent payable was £65 invoiced annually. The lease terminated on 22 February 2094. Given that there were 68 years unexpired we approximated the premium to the freeholder for the lease extension to be within £13,300 and £15,400 not including costs.
Last month we were called by Dr Felix Bell , who acquired a basement flat in Badminton in June 2008. We are asked if we could estimate the compensation to the landlord would be for a 90 year extension to my lease. Similar properties in Badminton with a long lease were worth £208,600. The average ground rent payable was £60 collected annually. The lease expired in 2083. Considering the 57 years outstanding we estimated the premium to the freeholder for the lease extension to be between £30,400 and £35,200 plus costs.