The market value of Bosham leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can increase materialy once the remaining term is less than 80 years
It is generally accepted that a property with in excess of 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 30 years left, the residence will be equivalent in value to a freehold for decades to come.
| 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; |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with handle Bosham 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.
In 2014 Gabriel, came perilously near to the 80-year threshold with the lease on his leasehold apartment in Bosham. Having bought his property 19 years ago, the unexpired term was of no interest. Fortunately, he noticed he would soon be paying an inflated amount for a lease extension. Gabriel arranged for a lease extension just ahead of time in August. Gabriel and the landlord who owned the flat above subsequently agreed on a premium of £5,000 . If he failed to meet the deadline, the premium would have gone up by a minimum £1,025.
In 2010 we were phoned by Ms Phoebe López who, having completed a basement flat in Bosham in November 2010. The question was if we could estimate the compensation to the landlord would likely be to prolong the lease by an additional years. Similar properties in Bosham with 100 year plus lease were worth £200,000. The mid-range ground rent payable was £50 billed monthly. The lease lapsed on 16 January 2103. Given that there were 77 years remaining we calculated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 plus expenses.
Last November we were phoned by Mrs C Edwards , who completed a ground floor flat in Bosham in May 1996. The dilemma was if we could approximate the premium would likely be to extend the lease by 90 years. Similar residencies in Bosham with 100 year plus lease were worth £265,200. The mid-range amount of ground rent was £65 billed every twelve months. The lease expiry date was in 2092. Taking into account 66 years unexpired we calculated the premium to the freeholder for the lease extension to be between £15,200 and £17,600 plus fees.