The market value of a leasehold property in Boldon Colliery depends on how long the lease has left to run. If it is near to or fewer than eighty years you should envisage difficulties on re-sale, so it is recommended to arrange for the lease to be extended before purchasing. It is preferable to commence the process of extending the lease is when a lease still has 82 years to run so that a lease extension can be addressed in advance of the 80 year cut off point. Current legislation entitles Boldon Colliery qualifying lessees to obtain a new lease which will be for the balance of the existing lease plus a supplemental term of 90 years. The intention of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is conventional wisdom that a residential leasehold with more than 100 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 left, the premises will be equivalent in value to a freehold for many years in the future.
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with undertake Boldon Colliery 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.
Half a year ago Callum, came precariously close to the 80-year mark with the lease on his one bedroom flat in Boldon Colliery. Having bought his flat two decades ago, the unexpired term was of no relevance. Fortunately, he noticed he needed to take action soon on a lease extension. Callum arranged for a lease extension at the eleventh hour in August. Callum and the landlord subsequently settled on sum of £5,500 . If he had missed the deadline, the sum would have gone up by a minimum £1,000.
In 2012 we were approached by Mr and Mrs. G Lefebvre who, having owned a purpose-built apartment in Boldon Colliery in March 2012. We are asked if we could shed any light on how much (approximately) premium could be to prolong the lease by 90 years. Comparable properties in Boldon Colliery with 100 year plus lease were in the region of £290,000. The mid-range ground rent payable was £45 collected yearly. The lease ended on 3 June 2099. Given that there were 74 years unexpired we estimated the premium to the landlord for the lease extension to be between £8,600 and £9,800 plus costs.
In 2009 we were phoned by Mr and Mrs. L Martinez who, having owned a ground floor apartment in Boldon Colliery in May 1998. The dilemma was if we could approximate the premium would likely be for a ninety year extension to my lease. Identical residencies in Boldon Colliery with 100 year plus lease were worth £243,000. The average amount of ground rent was £65 billed every twelve months. The lease expiry date was in 2088. Taking into account 63 years remaining we approximated the compensation to the freeholder to extend the lease to be between £20,000 and £23,000 exclusive of legals.