The market value of a leasehold property in Burnham is impacted by how many years the lease has remaining. If it is near to or less than 80 years you should envisage difficulties on re-sale, so it is advisable to arrange for a lease extension ahead of buying. It is ideal to start the lease extension process when the lease still has 82 years to run so that a lease extension can be addressed prior to the eighty year threshold. Statute entitles Burnham qualifying lessees to acquire a new lease which will be for the current unexpired lease term plus an additional term of ninety years. The purpose of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the acquisition of the lease extension.
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 conveyancing solicitors that we work with handle Burnham 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.
Aaron was the the leasehold proprietor of a 2 bedroom apartment in Burnham being marketed with a lease of a few days over 72 years unexpired. Aaron on an informal basis contacted his freeholder a well known Bristol-based freehold company for a lease extension. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent to start with set at £100 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Aaron to invoke his statutory right. Aaron procured expert advice and was able to make an informed decision and deal with the matter and readily saleable.
Mr and Mrs. U Kelly completed a ground floor flat in Burnham in March 2000. We are asked if we could approximate the compensation to the landlord could be to prolong the lease by an additional years. Similar homes in Burnham with 100 year plus lease were in the region of £267,600. The average ground rent payable was £65 billed quarterly. The lease end date was in 2093. Considering the 67 years outstanding we calculated the premium to the landlord for the lease extension to be within £14,300 and £16,400 exclusive of professional charges.
In 2014 we were approached by Mr Connor Bernard who, having took over the lease of a newly refurbished flat in Burnham in August 2008. The question was if we could approximate the premium could be for a ninety year extension to my lease. Similar homes in Burnham with 100 year plus lease were worth £201,200. The average ground rent payable was £55 billed quarterly. The lease finished on 6 January 2082. Considering the 56 years as a residual term we calculated the premium to the freeholder to extend the lease to be within £31,400 and £36,200 plus fees.