Burwash residential property owned on a long lease is a depreciating asset as the leaseholder only owns the property for a period of years.
It is generally accepted that a property with more than 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 35 years unexpired, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 75 years plus the term of the mortgage at the outset 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 |
Engaging our service will provide you enhanced control over the value of your Burwash leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In recent months Elijah, started to get close to the eighty-year mark with the lease on his leasehold flat in Burwash. In buying his property 18 years previously, the lease term was of minimal bearing. Luckily, he noticed he needed to take steps soon on a lease extension. Elijah extended the lease at the eleventh hour last May. Elijah and the freeholder eventually agreed on sum of £5,500 . If the lease had gone to less than 80 years, the sum would have become more exhorbitant by a minimum £950.
In 2011 we were e-mailed by Mr and Mrs. U Collins who, having purchased a studio apartment in Burwash in January 2011. The dilemma was if we could shed any light on how much (approximately) price would be to extend the lease by a further 90 years. Comparative premises in Burwash with 100 year plus lease were in the region of £210,000. The average amount of ground rent was £50 collected annually. The lease concluded in 2105. Having 79 years unexpired we estimated the premium to the freeholder to extend the lease to be between £8,600 and £9,800 plus fees.
Last Autumn we were contacted by Mr B Nguyen , who acquired a newly refurbished apartment in Burwash in November 2010. The dilemma was if we could estimate the compensation to the landlord would be for a 90 year extension to my lease. Comparable residencies in Burwash with 100 year plus lease were valued about £275,000. The mid-range amount of ground rent was £45 collected per annum. The lease ended on 23 July 2095. Having 69 years left we estimated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 plus costs.