The market value of Downend 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 substantially once the unexpired lease term is less than eighty years
Leasehold properties in Downend with in excess of one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Godiva Mortgages | 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. |
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a landlord in Downend,the lease extension experts 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 Downend valuers.
Samuel was the the leasehold owner of a 2 bedroom apartment in Downend being sold with a lease of a little over 59 years left. Samuel informally approached his landlord a well known local-based freehold company for a lease extension. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £200 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Samuel to exercise his statutory right. Samuel procured expert advice and secured satisfactory deal without going to tribunal and readily saleable.
Last Spring we were contacted by Mr and Mrs. G Martin , who moved into a studio apartment in Downend in April 2001. We are asked if we could estimate the premium would likely be to extend the lease by 90 years. Similar residencies in Downend with an extended lease were worth £213,600. The mid-range ground rent payable was £60 billed quarterly. The lease termination date was on 3 October 2083. Taking into account 57 years outstanding we calculated the compensation to the landlord to extend the lease to be between £30,400 and £35,200 plus expenses.
Last month we were contacted by Mrs Rachel Pérez , who owned a basement apartment in Downend in June 1999. We are asked if we could approximate the premium could be for a 90 year extension to my lease. Identical flats in Downend with an extended lease were in the region of £200,000. The average ground rent payable was £50 billed every twelve months. The lease terminated in 2103. Having 77 years as a residual term we approximated the premium to the landlord for the lease extension to be within £8,600 and £9,800 plus expenses.