The market value of a leasehold property in Emersons Green is impacted by how many years the lease has remaining. If it is close to or less than 80 years you should expect problems on re-sale, so it is recommended to arrange for the lease to be extended ahead of buying. It is preferable to commence the process of extending the lease is when the lease still has 82 years remaining so that a lease extension can be addressed prior to the eighty year threshold. Leasehold Reform legislation enables Emersons Green qualifying lessees to a 90 year extension added to their residual lease term (ie if your lease has 50 years left the statutory lease extension will provide a new term of 140 years). The purpose of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is conventional wisdom that a property with in excess of 100 years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| 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 will provide you enhanced control over the value of your Emersons Green leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Max, started to get near to the eighty-year mark with the lease on his two bedroom apartment in Emersons Green. In buying his property two decades ago, the unexpired term was of little concern. Thankfully, it dawned on him that he needed to take steps soon on Extending the lease. Max was able to extend his lease just under the wire last September. Max and the landlord in the end agreed on an amount of £5,500 . If the lease had fallen lower than 80 years, the figure would have become more costly by at least £1,050.
Last Autumn we were contacted by Dr Freddie Morris , who owned a purpose-built apartment in Emersons Green in July 2002. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be for a 90 year lease extension. Comparative premises in Emersons Green with 100 year plus lease were worth £275,000. The average amount of ground rent was £65 billed quarterly. The lease terminated in 2092. Taking into account 68 years as a residual term we approximated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 plus professional charges.
Last year we were called by Mr and Mrs. G Bennett , who completed a ground floor flat in Emersons Green in May 2000. The question was if we could shed any light on how much (roughly) premium would be to extend the lease by a further 90 years. Comparable properties in Emersons Green with 100 year plus lease were in the region of £208,600. The average ground rent payable was £60 invoiced per annum. The lease concluded on 23 October 2081. Having 57 years remaining we calculated the premium to the freeholder to extend the lease to be within £30,400 and £35,200 exclusive of legals.