Unfortunately that a Bourton on the Water residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Bourton on the Water property market.Once your lease gets to 85ish years, you should start considering a lease extension. If the number of years remaining falls under eighty years, you will end up paying 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Bourton on the Water will be able to extend under the legislation; however a lawyer will be able to clarify whether you qualify for an extension. In some cases you may not be entitled. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the process.
Leasehold premises in Bourton on the Water with in excess of 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| 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; |
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| 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. |
Retaining our service will provide you increased control over the value of your Bourton on the Water leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
After lengthy correspondence with the landlord of her basement flat in Bourton on the Water, Jade started the lease extension process as the eighty year mark was rapidly coming. The lease extension completed in March 2012. The landlord’s costs were negotiated to slightly above 550 pounds.
In 2014 we were e-mailed by Mrs K López who, having owned a newly refurbished flat in Bourton on the Water in July 2002. The dilemma was if we could approximate the compensation to the landlord would be for a ninety year lease extension. Comparable premises in Bourton on the Water with an extended lease were in the region of £235,200. The average amount of ground rent was £45 collected yearly. The lease termination date was in 2092. Having 66 years unexpired we estimated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 not including fees.
In 2012 we were approached by Mrs D Carter who, having owned a one bedroom apartment in Bourton on the Water in March 2003. We are asked if we could shed any light on how much (roughly) price could be for a ninety year extension to my lease. Comparative properties in Bourton on the Water with an extended lease were valued around £275,000. The mid-range ground rent payable was £55 invoiced every twelve months. The lease elapsed on 12 May 2103. Taking into account 77 years as a residual term we approximated the compensation to the freeholder to extend the lease to be within £13,300 and £15,400 not including legals.