It’s a harsh certainty that a Fairford residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the depreciation being disguised by increases in the Fairford property market.Where your lease has approximately 90 years left, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips under eighty years - otherwise a higher premium will be due. Most flat owners in Fairford will be able to extend under the legislation; however a lawyer should be able to confirm whether you are eligibility. In some cases you may not qualify. There are also strict timetables and procedures to follow once the process is instigated and you will need to be guided by your conveyancing solicitor throughout the process.
It is conventional wisdom that a property with more than 100 years remaining is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 30 years unexpired, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Fairford can be a difficult process. We recommend you secure professional help from a lawyer and valuer well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring Fairford lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last Spring Hunter, started to get near to the eighty-year threshold with the lease on his one bedroom flat in Fairford. In buying his flat two decades ago, the unexpired term was of no significance. by good luck, he realised he needed to take steps soon on Extending the lease. Hunter was able to extend his lease at the eleventh hour last May. Hunter and the freeholder via the management company subsequently agreed on a premium of £6,000 . If the lease had dropped below 80 years, the price would have escalated by a minimum £875.
Ms Megan Stewart owned a purpose-built apartment in Fairford in June 2004. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord could be to extend the lease by an additional years. Comparable premises in Fairford with an extended lease were worth £174,200. The average ground rent payable was £55 invoiced per annum. The lease expired on 25 April 2076. Considering the 51 years left we approximated the compensation to the landlord to extend the lease to be between £31,400 and £36,200 not including expenses.
Last Winter we were called by Mrs B Reed , who moved into a first floor flat in Fairford in September 2000. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord could be for a ninety year extension to my lease. Similar residencies in Fairford with a long lease were in the region of £285,000. The average amount of ground rent was £45 invoiced per annum. The lease expired in 2096. Taking into account 71 years left we approximated the premium to the freeholder for the lease extension to be between £12,400 and £14,200 exclusive of fees.