The market value of Bures leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can escalate substantially once the remaining term is less than 80 years
It is generally considered that a property with over 100 years remaining is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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 30 years plus the term of the mortgage at the outset of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
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The lawyers that we work with handle Bures 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.
Kian was the the leasehold proprietor of a 2 bedroom flat in Bures on the market with a lease of a little over fifty eight years outstanding. Kian informally contacted his landlord a well known local-based freehold company for a lease extension. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £125 yearly. No ground rent would be payable on a lease extension were Kian to invoke his statutory right. Kian procured expert advice and secured an acceptable resolution without going to tribunal and sell the property.
In 2013 we were e-mailed by Mrs Jodie Gunderson who, having completed a garden apartment in Bures in January 2008. The question was if we could approximate the premium would be for a 90 year extension to my lease. Comparable premises in Bures with a long lease were in the region of £232,800. The average amount of ground rent was £45 collected every twelve months. The lease lapsed in 2091. Given that there were 65 years outstanding we approximated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 plus fees.
In 2010 we were e-mailed by Mr G Wilson who, having was assigned a lease of a newly refurbished flat in Bures in November 2008. The dilemma was if we could estimate the price would likely be to prolong the lease by ninety years. Comparative properties in Bures with an extended lease were in the region of £275,000. The average ground rent payable was £55 billed per annum. The lease ran out on 20 April 2102. Considering the 76 years remaining we estimated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 exclusive of fees.