The value of Bury St Edmunds 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 increase materialy once the unexpired lease term is less than 80 years
It is generally accepted that a residential leasehold with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to any lease with more than 35 years unexpired, the premises will be worth the same as a freehold for decades to come.
| 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; |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with handle Bury St Edmunds 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 conveyancing solicitor we work with provide it.
Subsequent to protracted negotiations with the freeholder of her leasehold flat in Bury St Edmunds, Jessica started the lease extension process just as her lease was approaching the all-important eighty-year mark. The transaction was concluded in January 2007. The freeholder’s costs were restricted to slightly above 550 GBP.
Last Summer we were called by Dr Leah Ward , who completed a recently refurbished flat in Bury St Edmunds in November 1995. The dilemma was if we could approximate the price could be for a 90 year lease extension. Identical premises in Bury St Edmunds with a long lease were worth £270,000. The mid-range amount of ground rent was £55 billed annually. The lease finished in 2101. Having 75 years unexpired we estimated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 exclusive of professional charges.
In 2012 we were e-mailed by Dr O Phillips who, having acquired a first floor apartment in Bury St Edmunds in February 1996. We are asked if we could approximate the compensation to the landlord would likely be for a ninety year extension to my lease. Comparative flats in Bury St Edmunds with an extended lease were valued about £173,800. The average ground rent payable was £65 invoiced monthly. The lease elapsed on 9 February 2081. Taking into account 55 years as a residual term we estimated the compensation to the landlord to extend the lease to be between £31,400 and £36,200 exclusive of costs.