The value of Cross Hands 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 remaining term is less than eighty years
It is generally accepted that a property with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
Irrespective of whether you are a tenant or a freeholder in Cross Hands,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Cross Hands valuers.
Last year Ben, came seriously close to the 80-year mark with the lease on his two bedroom apartment in Cross Hands. In buying his flat two decades ago, the unexpired term was of minimal concern. As luck would have it, it dawned on him that he would soon be paying an inflated amount for a lease extension. Ben arranged for a lease extension at the eleventh hour in May. Ben and the landlord eventually settled on the final figure of £6,000 . If he not met the deadline, the sum would have escalated by a minimum £875.
Mr S Martinez was assigned a lease of a purpose-built flat in Cross Hands in June 2010. The dilemma was if we could estimate the price would likely be for a ninety year lease extension. Identical flats in Cross Hands with an extended lease were in the region of £250,000. The average amount of ground rent was £50 invoiced per annum. The lease expired in 2095. Having 69 years as a residual term we calculated the premium to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of professional charges.
Mr and Mrs. A Baker took over the lease of a first floor apartment in Cross Hands in January 1995. The dilemma was if we could shed any light on how much (approximately) price would likely be to extend the lease by 90 years. Comparable properties in Cross Hands with a long lease were valued around £285,000. The mid-range ground rent payable was £55 billed quarterly. The lease terminated on 26 February 2106. Having 80 years unexpired we calculated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 plus legals.