It’s a harsh truth that a Farnham Common residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the Farnham Common property prices.Where your lease has approximately 90 years left, 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 slips lower than eighty years - otherwise a higher premium will be payable. The majority of leasehold owners in Farnham Common will be able to extend under the legislation; however a lawyer will be able to clarify if you qualify for an extension. In some cases you may not qualify. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the process.
It is generally considered that a property with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the residence 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Lease extensions in Farnham Common can be a difficult process. We recommend you procure professional help from a lawyer and surveyor with experience in this area.
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 dealing with 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.
Half a year ago Hunter, started to get near to the 80-year threshold with the lease on his basement apartment in Farnham Common. In buying his property 19 years ago, the lease term was of minimal concern. Thankfully, he became aware that he needed to take steps soon on Extending the lease. Hunter was able to extend his lease at the eleventh hour in August. Hunter and the freeholder via the management company ultimately agreed on the final figure of £5,000 . If the lease had slid lower than eighty years, the premium would have increased by at least £900.
Last year we were called by Mr Harvey Hernández , who took over the lease of a purpose-built flat in Farnham Common in May 2007. The question was if we could shed any light on how much (roughly) compensation to the landlord would be to prolong the lease by ninety years. Identical residencies in Farnham Common with an extended lease were in the region of £200,800. The mid-range ground rent payable was £65 billed every twelve months. The lease termination date was in 2085. Having 60 years as a residual term we approximated the premium to the freeholder to extend the lease to be within £20,900 and £24,200 plus legals.
In 2010 we were called by Ms F Baker who, having was assigned a lease of a purpose-built apartment in Farnham Common in November 2007. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be for a ninety year extension to my lease. Comparative premises in Farnham Common with an extended lease were in the region of £255,000. The average ground rent payable was £50 billed monthly. The lease end date was on 15 August 2096. Having 71 years left we calculated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 plus expenses.