The re-sale value of a leasehold property in Easthampstead is impacted by how many years the lease has left to run. If it is near to or fewer than 80 years you should expect difficulties on re-sale, so it is recommended to arrange for the lease to be extended before buying. It is preferable to start the lease extension process when the lease still has 82 years to run so that formalities can be addressed ahead of the eighty year mark. Current legislation enables Easthampstead qualifying lessees to obtain a lease extension of 90 years in addition to the remaining lease term at a peppercorn rent (that is, rent free). The intention of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold premises in Easthampstead with over 100 years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and service 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| 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. |
The lawyers that we work with handle Easthampstead 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 lawyer we work with provide it.
Last year Sebastian, started to get near to the 80-year threshold with the lease on his first floor flat in Easthampstead. In buying his home two decades ago, the length of the lease was of little concern. Fortunately, he noticed he would soon be paying way over the odds for Extending the lease. Sebastian arranged for a lease extension just ahead of time in April. Sebastian and the landlord who owned the flat above in the end settled on a premium of £6,000 . If the lease had dropped below eighty years, the premium would have become more exhorbitant by at least £1,125.
Mr and Mrs. W Jones acquired a garden flat in Easthampstead in November 2005. The dilemma was if we could estimate the compensation to the landlord would be to prolong the lease by an additional years. Comparative premises in Easthampstead with 100 year plus lease were valued about £257,800. The average amount of ground rent was £65 collected yearly. The lease lapsed in 2090. Having 65 years as a residual term we estimated the premium to the landlord to extend the lease to be within £18,100 and £20,800 not including expenses.
Last Summer we were e-mailed by Mrs Laura Carter , who was assigned a lease of a newly refurbished flat in Easthampstead in August 2011. The dilemma was if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Comparative properties in Easthampstead with an extended lease were worth £191,400. The mid-range amount of ground rent was £55 billed every twelve months. The lease concluded in 2079. Taking into account 54 years left we calculated the premium to the freeholder to extend the lease to be between £34,200 and £39,600 not including professional charges.