The market value of Chiseldon leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can increase significantly once the unexpired lease term is less than 80 years
It is conventional wisdom that a residential leasehold with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| 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. |
| 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Using our service gives you enhanced control over the value of your Chiseldon leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Joseph was the the leasehold owner of a studio flat in Chiseldon being marketed with a lease of just over fifty eight years outstanding. Joseph on an informal basis contacted his freeholder a well known local-based freehold company and enquired on a premium to extend the lease. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £125 per annum. Ordinarily, ground rent would not be payable on a lease extension were Joseph to exercise his statutory right. Joseph obtained expert legal guidance and secured an acceptable deal informally and sell the property.
Mrs Lydia Dupont was assigned a lease of a newly refurbished apartment in Chiseldon in September 2006. We are asked if we could approximate the price could be for a ninety year lease extension. Identical premises in Chiseldon with an extended lease were valued about £200,800. The mid-range ground rent payable was £65 billed annually. The lease finished on 9 April 2086. Considering the 60 years unexpired we estimated the compensation to the landlord to extend the lease to be between £20,900 and £24,200 not including legals.
In 2013 we were e-mailed by Mr G Cooper who, having completed a basement flat in Chiseldon in October 2003. We are asked if we could estimate the compensation to the landlord could be for a ninety year lease extension. Comparable flats in Chiseldon with a long lease were valued around £255,000. The mid-range amount of ground rent was £50 collected quarterly. The lease concluded in 2097. Given that there were 71 years outstanding we calculated the premium to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of costs.