Fawley residential property held on a long lease is a depreciating asset because a leaseholder merely owns the property for a period of years.
Leasehold residencies in Fawley with in excess of 100 years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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 |
Using our service gives you better control over the value of your Fawley leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Evan owned a conversion apartment in Fawley on the market with a lease of fraction over 59 years left. Evan on an informal basis spoke with his freeholder a well known local-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 on the basis of a new rent at the outset set at £150 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Evan to exercise his statutory right. Evan obtained expert legal guidance and was able to make an informed judgement and deal with the matter and readily saleable.
Dr Leo Hill moved into a purpose-built apartment in Fawley in April 2001. The dilemma was if we could approximate the premium would be for a ninety year lease extension. Similar homes in Fawley with an extended lease were worth £280,000. The average amount of ground rent was £45 invoiced yearly. The lease concluded in 2097. Given that there were 71 years remaining we estimated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 plus legals.
Dr Tommy Collins purchased a newly refurbished apartment in Fawley in April 2009. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord would be for a 90 year lease extension. Comparative flats in Fawley with an extended lease were valued around £225,800. The average amount of ground rent was £60 collected quarterly. The lease ran out on 6 May 2086. Given that there were 60 years remaining we estimated the compensation to the landlord for the lease extension to be within £25,700 and £29,600 not including professional charges.