Faringdon leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. Most owners of residential leasehold property in Faringdon enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Faringdon you would be well advised to check if your lease has between 70 and 90 years left. There are good reasons why a Faringdon leaseholder with a lease having around eighty years unexpired should take action to ensure that a lease extension is effected without delay
It is conventional wisdom that a residential leasehold with more than one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 30 years remaining, the premises will be equivalent in value to a freehold for many years in the future.
| 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
Regardless of whether you are a tenant or a freeholder in Faringdon,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 Faringdon valuers.
Last year Dexter, started to get close to the 80-year mark with the lease on his two bedroom apartment in Faringdon. In buying his flat two decades ago, the lease term was of minimal significance. by good luck, he noticed he needed to take steps soon on a lease extension. Dexter arranged for a lease extension just under the wire last January. Dexter and the landlord subsequently settled on a premium of £5,000 . If he failed to meet the deadline, the amount would have become more costly by at least £875.
In 2012 we were contacted by Mr Hugo Lefebvre who, having moved into a garden apartment in Faringdon in February 1998. The question was if we could approximate the price could be for a ninety year extension to my lease. Comparative residencies in Faringdon with a long lease were valued around £275,000. The average ground rent payable was £45 billed annually. The lease lapsed on 20 June 2094. Considering the 69 years left we approximated the premium to the landlord for the lease extension to be between £12,400 and £14,200 exclusive of legals.
Last Spring we were contacted by Mr K Miller , who owned a ground floor apartment in Faringdon in March 2009. The question was if we could shed any light on how much (roughly) compensation to the landlord would likely be for a ninety year extension to my lease. Comparable homes in Faringdon with 100 year plus lease were valued about £216,000. The average ground rent payable was £60 collected per annum. The lease ran out on 25 August 2083. Having 58 years unexpired we approximated the premium to the freeholder to extend the lease to be within £28,500 and £33,000 exclusive of legals.