The market value of Fareham leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can increase materialy once the remaining term is less than eighty years
It is generally considered that a property with over one hundred years unexpired lease term is worth approximately 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 in the future.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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 |
Irrespective of whether you are a tenant or a landlord in Fareham,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Fareham valuers.
Two years ago Harvey, came perilously near to the 80-year mark with the lease on his basement apartment in Fareham. In buying his property twenty years ago, the lease term was of no importance. by good luck, he became aware that he needed to take steps soon on Extending the lease. Harvey arranged for a lease extension just under the wire in July. Harvey and the freeholder eventually agreed on an amount of £5,500 . If the lease had fallen lower than eighty years, the figure would have increased by at least £1,125.
Last Autumn we were e-mailed by Dr S Hall , who moved into a one bedroom apartment in Fareham in August 2002. The question was if we could estimate the premium would be for a ninety year extension to my lease. Comparable homes in Fareham with 100 year plus lease were valued about £216,000. The average ground rent payable was £60 collected monthly. The lease terminated in 2084. Given that there were 58 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £28,500 and £33,000 plus costs.
Last Winter we were phoned by Mr and Mrs. J Ramírez , who was assigned a lease of a ground floor apartment in Fareham in September 1998. The question was if we could approximate the premium could be to prolong the lease by an additional years. Similar residencies in Fareham with a long lease were in the region of £200,000. The mid-range amount of ground rent was £50 collected annually. The lease finished in 2104. Having 78 years left we calculated the premium to the landlord for the lease extension to be between £8,600 and £9,800 not including professional charges.