With a long leasehold premises in Fordingbridge, you effectively rent it for a certain period of time. In recent years flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you should think about a lease extension sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease increases markedly particularly once there are less than 80 years remaining. Residents in Fordingbridge with a lease approaching 81 years left should seriously think of extending it as soon as possible. Once the lease term has below 80 years remaining, under the current Act the landlord is entitled to calculate and levy a greater premium, based on a technical calculation, strangely termed as “marriage value” which is due.
It is generally accepted that a property with more than 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 35 years left, the premises will be worth the same as a freehold for decades to come.
| 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; |
| 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you increased control over the value of your Fordingbridge leasehold, as your property will be more valuable and saleable in relation to the lease length should you want to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Toby owned a high value flat in Fordingbridge on the market with a lease of fraction over 61 years left. Toby on an informal basis approached his freeholder being a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to an increased rent to £200 per annum. No ground rent would be due on a lease extension were Toby to invoke his statutory right. Toby obtained expert advice and secured satisfactory resolution without going to tribunal and readily saleable.
In 2009 we were approached by Mrs Eleanor Moore who, having bought a studio flat in Fordingbridge in June 2009. The dilemma was if we could estimate the premium would be for a ninety year extension to my lease. Similar homes in Fordingbridge with an extended lease were in the region of £191,400. The average amount of ground rent was £55 billed per annum. The lease expired on 13 April 2080. Considering the 54 years as a residual term we estimated the premium to the landlord for the lease extension to be within £34,200 and £39,600 not including costs.
Last Spring we were approach by Mr and Mrs. U Clarke , who acquired a garden flat in Fordingbridge in April 2006. We are asked if we could shed any light on how much (roughly) price would be for a ninety year extension to my lease. Identical homes in Fordingbridge with an extended lease were worth £295,000. The mid-range amount of ground rent was £45 collected quarterly. The lease finished on 12 May 2100. Considering the 74 years remaining we estimated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 plus expenses.