Chances are that if you own a flat in Fairford you actually own a long leasehold interest over your property
It is conventional wisdom that a property with more than 100 years remaining is worth roughly the same 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 decades to come.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| 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. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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 better control over the value of your Fairford leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last Summer Jake, started to get close to the eighty-year mark with the lease on his garden apartment in Fairford. In buying his home 18 years ago, the unexpired term was of no relevance. Thankfully, it dawned on him that he needed to take steps soon on Extending the lease. Jake was able to extend his lease just in the nick of time in March. Jake and the freeholder eventually settled on an amount of £5,000 . If the lease had slid below 80 years, the amount would have increased by a minimum £950.
In 2013 we were e-mailed by Mr and Mrs. H Green who, having bought a one bedroom apartment in Fairford in March 2012. The question was if we could estimate the price would likely be for a ninety year extension to my lease. Comparative residencies in Fairford with an extended lease were valued about £191,400. The average amount of ground rent was £55 collected monthly. The lease expired in 2079. Considering the 54 years unexpired we estimated the premium to the freeholder to extend the lease to be between £34,200 and £39,600 exclusive of legals.
Last Summer we were phoned by Dr James Mason , who took over the lease of a first floor flat in Fairford in July 1999. The question was if we could approximate the price would likely be for a 90 year lease extension. Comparable premises in Fairford with a long lease were valued around £295,000. The mid-range ground rent payable was £45 billed monthly. The lease ran out in 2099. Taking into account 74 years outstanding we approximated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 plus fees.