Felpham residential property held on a long lease is a wasting asset because a leaseholder only owns the property for a period of years.
It is conventional wisdom that a property with more than one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years in the future.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset 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. |
Irrespective of whether you are a tenant or a landlord in Felpham,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Felpham valuers.
In 2014 Tommy, started to get close to the 80-year threshold with the lease on his first floor apartment in Felpham. Having bought his flat twenty years ago, the unexpired term was of no interest. Thankfully, he noticed he needed to take action soon on a lease extension. Tommy extended the lease at the eleventh hour last January. Tommy and the landlord who owned the flat above in the end settled on sum of £6,000 . If he had missed the deadline, the premium would have escalated by a minimum £1,050.
Last month we were contacted by Dr B Alexander , who completed a one bedroom apartment in Felpham in June 1995. We are asked if we could approximate the compensation to the landlord would likely be to extend the lease by a further 90 years. Identical premises in Felpham with a long lease were valued about £210,600. The average ground rent payable was £45 collected annually. The lease expiry date was in 2087. Given that there were 62 years outstanding we estimated the compensation to the landlord to extend the lease to be between £18,100 and £20,800 not including professional charges.
Last Spring we were contacted by Mr and Mrs. R Taylor , who acquired a one bedroom flat in Felpham in October 2003. The question was if we could shed any light on how much (approximately) price would be for a ninety year lease extension. Identical properties in Felpham with an extended lease were valued around £265,000. The average ground rent payable was £50 billed annually. The lease end date was on 22 May 2098. Taking into account 73 years as a residual term we approximated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 not including professional charges.