Unfortunately that a Farnham Common 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 early years due to the depreciation being disguised by increases in the Farnham Common property prices.Once your lease gets to 85ish years, you need to start thinking about 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 falls lower than 80 years - otherwise a higher premium will be due. Most flat owners in Farnham Common will be able to extend under the legislation; however a conveyancer will be able to clarify whether you are eligibility. In some cases you may not qualify. There are also strict deadlines and procedures to follow once the process is instigated and you will need to be guided by your conveyancer from beginning to end of the formalities.
Leasehold premises in Farnham Common with more than 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Coventry Building Society | 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Farnham Common can be a difficult process. We recommend you secure guidance from a conveyancer and valuer with experience in lease extensions.
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 Farnham Common lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Jasper was the the leasehold proprietor of a 2 bedroom flat in Farnham Common being marketed with a lease of a few days over fifty eight years remaining. Jasper on an informal basis approached his freeholder a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Jasper to exercise his statutory right. Jasper obtained expert legal guidance and secured satisfactory resolution informally and readily saleable.
In 2014 we were phoned by Mrs Megan Morgan who, having acquired a one bedroom apartment in Farnham Common in April 2008. We are asked if we could approximate the price could be for a 90 year extension to my lease. Comparative flats in Farnham Common with 100 year plus lease were valued about £256,600. The average ground rent payable was £60 invoiced every twelve months. The lease expired in 2077. Taking into account 52 years outstanding we calculated the premium to the freeholder to extend the lease to be between £41,800 and £48,400 exclusive of costs.
In 2013 we were contacted by Dr F Walker who, having owned a basement flat in Farnham Common in May 1996. We are asked if we could approximate the price could be for a ninety year extension to my lease. Comparative homes in Farnham Common with an extended lease were valued around £218,000. The mid-range ground rent payable was £45 collected per annum. The lease ran out in 2088. Considering the 63 years outstanding we approximated the compensation to the landlord for the lease extension to be between £17,100 and £19,800 not including legals.