The re-sale value of a leasehold property in Bispham is impacted by how many years the lease has remaining. If it is near to or less than eighty years you should anticipate difficulties on re-sale, so it is recommended to arrange for the lease to be extended prior to purchasing. It is ideal to start the lease extension process when a lease still has 82 years unexpired so that formalities can be finalised in advance of the 80 year mark. Current legislation entitles Bispham qualifying lessees to acquire a new lease which will be for the current unexpired lease term plus an additional term of ninety years. The intention of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the purchase of the lease extension.
It is generally accepted that a residential leasehold with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with handle Bispham 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 lawyer we work with provide it.
Subsequent to lengthy negotiations with the landlord of her two bedroom flat in Bispham, Isabella started the lease extension process just as the lease was approaching the critical 80-year mark. The transaction was finalised in July 2006. The landlord’s charges were kept to an absolute minimum.
In 2012 we were called by Dr N Bernard who, having acquired a studio apartment in Bispham in May 2006. We are asked if we could estimate the compensation to the landlord would likely be for a ninety year lease extension. Comparative premises in Bispham with 100 year plus lease were worth £275,000. The average amount of ground rent was £55 invoiced yearly. The lease concluded on 16 April 2102. Having 77 years unexpired we calculated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 not including costs.
In 2013 we were approached by Mrs Freya Harris who, having moved into a recently refurbished flat in Bispham in June 1995. We are asked if we could shed any light on how much (approximately) compensation to the landlord could be to extend the lease by 90 years. Comparable homes in Bispham with an extended lease were worth £183,600. The average amount of ground rent was £65 collected yearly. The lease end date was in 2082. Given that there were 57 years outstanding we calculated the premium to the landlord to extend the lease to be between £28,500 and £33,000 exclusive of costs.