Brackla residential property owned on a long lease is a wasting asset as the leaseholder only owns the property for a period of years.
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date 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. |
| 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 Brackla,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Brackla valuers.
After lengthy negotiations with the landlord of her first floor apartment in Brackla, Harriet commenced the lease extension process as the 80 year threshold was swiftly advancing. The transaction completed in April 2008. The landlord’s costs were kept to an absolute minimum.
Last year we were contacted by Mrs Isabel Cox , who acquired a studio apartment in Brackla in February 2000. We are asked if we could estimate the compensation to the landlord would likely be to extend the lease by a further 90 years. Identical flats in Brackla with an extended lease were valued around £246,800. The average ground rent payable was £60 invoiced annually. The lease lapsed in 2076. Taking into account 50 years outstanding we approximated the compensation to the freeholder to extend the lease to be within £44,700 and £51,600 exclusive of legals.
In 2014 we were approached by Mr and Mrs. O García who, having was assigned a lease of a first floor flat in Brackla in August 2011. The question was if we could shed any light on how much (roughly) price would likely be to extend the lease by ninety years. Comparative premises in Brackla with a long lease were in the region of £208,200. The mid-range ground rent payable was £65 invoiced yearly. The lease came to a finish on 8 August 2087. Given that there were 61 years as a residual term we approximated the premium to the freeholder to extend the lease to be within £20,000 and £23,000 plus fees.