The market value of Belton leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can escalate significantly once the remaining term is less than eighty years
Leasehold properties in Belton with more than 100 years outstanding on the lease are often referred to as ‘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 buying the reversionary interest unless savings on ground rent and maintenance charges warrant 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; |
| Birmingham Midshires | 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 |
| 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. |
Irrespective of whether you are a tenant or a landlord in Belton,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Belton valuers.
In recent months Freddie, started to get close to the eighty-year mark with the lease on his first floor flat in Belton. In buying his flat two decades ago, the lease term was of no interest. Fortunately, he realised he would imminently be paying way over the odds for a lease extension. Freddie arranged for a lease extension just ahead of time in September. Freddie and the freeholder subsequently agreed on an amount of £5,000 . If he not met the deadline, the price would have increased by a minimum £1,075.
In 2010 we were phoned by Dr A Cooper who, having took over the lease of a ground floor apartment in Belton in September 2012. We are asked if we could approximate the compensation to the landlord would likely be for a 90 year extension to my lease. Comparable properties in Belton with an extended lease were valued about £218,400. The mid-range ground rent payable was £60 invoiced every twelve months. The lease termination date was in 2085. Considering the 59 years outstanding we calculated the premium to the landlord for the lease extension to be within £27,600 and £31,800 not including expenses.
Dr H White completed a studio apartment in Belton in March 1998. The question was if we could approximate the price could be for a 90 year extension to my lease. Comparative premises in Belton with 100 year plus lease were valued about £205,000. The mid-range amount of ground rent was £50 invoiced monthly. The lease terminated on 1 February 2105. Given that there were 79 years outstanding we approximated the compensation to the landlord for the lease extension to be between £8,600 and £9,800 plus costs.