Faringdon leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. It is the case that most Faringdon tenants have the right to extend their lease by an additional ninety years in accordance with the 1993 Leasehold Reform Act. Where you are a leasehold owner in Faringdon you should investigate if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under 80 years, the cost of any lease extension increases dramatically as an element of the premium you pay is what is known as a marriage value
Leasehold residencies in Faringdon with in excess of one hundred years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a landlord in Faringdon,the lease extension solicitors that we work with will always be prepared 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.
David owned a high value flat in Faringdon on the market with a lease of a few days over 59 years left. David informally contacted his landlord being a well known local-based freehold company for a lease extension. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £50 yearly. No ground rent would be due on a lease extension were David to invoke his statutory right. David obtained expert legal guidance and secured satisfactory deal informally and readily saleable.
In 2013 we were called by Dr Isabelle Khan who, having purchased a garden flat in Faringdon in April 2005. The dilemma was if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Comparative properties in Faringdon with 100 year plus lease were in the region of £208,600. The mid-range amount of ground rent was £60 collected per annum. The lease came to a finish on 26 February 2082. Given that there were 57 years as a residual term we calculated the compensation to the landlord to extend the lease to be within £30,400 and £35,200 exclusive of professional charges.
Mr Cameron Garcia moved into a one bedroom flat in Faringdon in October 2011. We are asked if we could shed any light on how much (roughly) price would likely be for a 90 year extension to my lease. Comparable flats in Faringdon with 100 year plus lease were worth £200,000. The mid-range ground rent payable was £50 collected quarterly. The lease ran out in 2102. Given that there were 77 years as a residual term we estimated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 exclusive of expenses.