The value of Barton Le Clay leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can escalate substantially once the unexpired lease term is less than 80 years
It is conventional wisdom that a property with more than one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to any lease with more than 45 years remaining, the premises will be worth the same as a freehold for many years ahead.
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
The conveyancing solicitors that we work with handle Barton Le Clay lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancer we work with provide it.
Two years ago Luca, started to get close to the 80-year threshold with the lease on his first floor flat in Barton Le Clay. Having bought his home twenty years ago, the length of the lease was of minimal bearing. by good luck, it dawned on him that he would imminently be paying an escalated premium for a lease extension. Luca extended the lease just under the wire in July. Luca and the freeholder via the management company ultimately agreed on an amount of £6,000 . If the lease had descended to less than 80 years, the sum would have become more exhorbitant by a minimum £1,100.
Dr Riley Taylor was assigned a lease of a garden apartment in Barton Le Clay in February 2008. We are asked if we could approximate the premium would likely be to prolong the lease by a further 90 years. Comparable residencies in Barton Le Clay with a long lease were in the region of £246,800. The average amount of ground rent was £60 collected annually. The lease elapsed on 2 August 2076. Given that there were 50 years as a residual term we calculated the compensation to the landlord for the lease extension to be between £44,700 and £51,600 plus expenses.
Last November we were contacted by Dr Amy Scott , who moved into a purpose-built apartment in Barton Le Clay in July 2000. The dilemma was if we could shed any light on how much (approximately) premium would be for a ninety year extension to my lease. Similar properties in Barton Le Clay with an extended lease were in the region of £208,200. The mid-range ground rent payable was £65 collected quarterly. The lease finished in 2087. Given that there were 61 years unexpired we calculated the premium to the landlord for the lease extension to be between £19,000 and £22,000 exclusive of legals.