The re-sale value of a leasehold property in Fairbourne depends on how long the lease has left to run. If it is near to or less than 80 years you should anticipate difficulties on re-sale, so it is recommended to arrange for the lease to be extended ahead of purchasing. It is ideal to start the lease extension process when a lease still has 82 years to run so that all matters can be addressed well before the 80 year mark. Statute enables Fairbourne qualifying lessees to an additional term of 90 years on top of the existing term, at a notional rent (zero ground rent). The purpose of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold residencies in Fairbourne with in excess of 100 years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | 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. |
Retaining our service will provide you enhanced control over the value of your Fairbourne leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Ibrahim was the the leasehold owner of a conversion flat in Fairbourne being marketed with a lease of fraction over 59 years remaining. Ibrahim informally approached his freeholder a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a new rent to start with set at £200 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Ibrahim to exercise his statutory right. Ibrahim procured expert legal guidance and secured satisfactory resolution without going to tribunal and readily saleable.
Last month we were approach by Ms W Wright , who bought a one bedroom flat in Fairbourne in July 2000. The question was if we could estimate the price would be to prolong the lease by ninety years. Identical properties in Fairbourne with an extended lease were in the region of £210,600. The average amount of ground rent was £45 invoiced yearly. The lease elapsed in 2088. Taking into account 62 years remaining we approximated the premium to the landlord to extend the lease to be within £18,100 and £20,800 exclusive of professional charges.
Last Spring we were called by Mr and Mrs. O Hill , who owned a purpose-built apartment in Fairbourne in May 2000. The dilemma was if we could estimate the premium could be to prolong the lease by ninety years. Similar properties in Fairbourne with an extended lease were worth £260,000. The average amount of ground rent was £50 collected monthly. The lease ran out on 27 October 2099. Having 73 years left we estimated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 not including legals.