The market value of a leasehold property in Burford depends on how many years the lease has remaining. If it is near to or less than eighty years you should envisage problems on re-sale, so it is advisable to arrange for the lease to be extended prior to buying. Ideally one should start the lease extension process when the lease still has 82 years unexpired so that a lease extension can be concluded ahead of the eighty year cut off point. Leasehold Reform legislation entitles Burford qualifying lessees to acquire a new lease which will be for the balance of the existing lease plus a further term of 90 years. The intention of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a property with over one hundred years remaining is worth roughly the equivalent as a freehold. Where an further ninety years added to any lease with more than 35 years remaining, the property will be equivalent in value to a freehold for many years in the future.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date 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 |
| 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. |
Engaging our service will provide you enhanced control over the value of your Burford leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
In recent months Dexter, started to get close to the 80-year mark with the lease on his ground floor apartment in Burford. Having purchased his home two decades ago, the length of the lease was of little relevance. by good luck, he noticed he needed to take action soon on a lease extension. Dexter arranged for a lease extension just ahead of time last May. Dexter and the freeholder subsequently settled on the final figure of £6,000 . If he not met the deadline, the figure would have gone up by a minimum £1,100.
Mr and Mrs. P Anderson was assigned a lease of a ground floor flat in Burford in July 2007. We are asked if we could shed any light on how much (roughly) premium could be to prolong the lease by ninety years. Comparable properties in Burford with a long lease were in the region of £285,000. The average amount of ground rent was £45 invoiced annually. The lease lapsed in 2098. Taking into account 72 years remaining we estimated the premium to the landlord for the lease extension to be between £12,400 and £14,200 not including professional charges.
In 2012 we were e-mailed by Mrs Y Carter who, having was assigned a lease of a one bedroom flat in Burford in September 2000. The dilemma was if we could approximate the compensation to the landlord could be for a 90 year lease extension. Comparable homes in Burford with a long lease were valued around £233,200. The average ground rent payable was £60 billed quarterly. The lease concluded on 24 June 2087. Having 61 years outstanding we estimated the compensation to the landlord to extend the lease to be within £22,800 and £26,400 exclusive of professional charges.