The value of Freshwater leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can increase materialy once the remaining term is less than 80 years
It is generally accepted that a residential leasehold with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 35 years left, the residence 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 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; |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service will provide you enhanced control over the value of your Freshwater leasehold, as your property will be more valuable and saleable in respect of lease length should you decide to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
In the wake of 9 months of protracted negotiations with the landlord of her one bedroom apartment in Freshwater, Nicole initiated the lease extension process as the 80 year mark was quickly advancing. The lease extension was finalised in February 2014. The landlord’s costs were negotiated to approximately six hundred GBP.
Last Spring we were approach by Mr and Mrs. C Phillips , who owned a one bedroom flat in Freshwater in January 2012. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be to extend the lease by ninety years. Similar residencies in Freshwater with a long lease were in the region of £220,400. The mid-range ground rent payable was £45 billed per annum. The lease expired on 1 January 2089. Taking into account 64 years as a residual term we estimated the premium to the landlord to extend the lease to be within £15,200 and £17,600 plus legals.
Last Autumn we were contacted by Mr and Mrs. T Michel , who completed a ground floor apartment in Freshwater in September 1995. We are asked if we could estimate the price would likely be for a 90 year lease extension. Identical premises in Freshwater with 100 year plus lease were valued around £270,000. The mid-range ground rent payable was £55 billed monthly. The lease ended in 2100. Having 75 years unexpired we approximated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 not including expenses.