Chances are that if you own a flat in Buckingham you actually own a long leasehold interest over your property
Leasehold residencies in Buckingham with in excess of one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service gives you better control over the value of your Buckingham leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to lengthy negotiations with the freeholder of her studio apartment in Buckingham, Chelsea initiated the lease extension process just as the lease was coming close to the all-important eighty-year mark. The lease extension completed in September 2012. The landlord’s costs were negotiated to a tad over 500 pounds.
Last month we were called by Mr Jack Jones , who was assigned a lease of a first floor apartment in Buckingham in August 1997. The question was if we could approximate the compensation to the landlord would likely be to prolong the lease by a further 90 years. Similar flats in Buckingham with a long lease were valued around £264,000. The average ground rent payable was £60 invoiced every twelve months. The lease terminated on 23 November 2079. Taking into account 53 years remaining we calculated the compensation to the landlord to extend the lease to be within £37,100 and £42,800 exclusive of professional charges.
In 2010 we were phoned by Dr A Peterson who, having completed a purpose-built apartment in Buckingham in September 1999. The dilemma was if we could shed any light on how much (approximately) premium would likely be to prolong the lease by ninety years. Comparable properties in Buckingham with an extended lease were in the region of £220,400. The average ground rent payable was £45 invoiced per annum. The lease end date was in 2090. Considering the 64 years remaining we approximated the compensation to the landlord to extend the lease to be within £15,200 and £17,600 exclusive of fees.