The market value of Fulwood and Elston leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can increase significantly once the remaining term is less than eighty years
It is generally accepted that a residential leasehold with more than 100 years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 30 years remaining, the property will be equivalent in value to a freehold for many years ahead.
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
Using our service gives you increased control over the value of your Fulwood and Elston 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 are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
After protracted negotiations with the landlord of her studio flat in Fulwood and Elston, Hollie started the lease extension process just as her lease was nearing the all-important eighty-year deadline. The lease extension was finalised in February 2012. The landlord’s charges were negotiated to less than 450 pounds.
Last month we were phoned by Dr Jodie Hernández , who bought a first floor apartment in Fulwood and Elston in October 2005. We are asked if we could estimate the premium would be for a ninety year extension to my lease. Identical homes in Fulwood and Elston with a long lease were worth £264,000. The mid-range amount of ground rent was £60 billed monthly. The lease expired in 2078. Given that there were 53 years unexpired we calculated the premium to the freeholder for the lease extension to be within £37,100 and £42,800 not including costs.
Mr M Martin owned a newly refurbished flat in Fulwood and Elston in November 1998. The question was if we could approximate the premium would likely be for a 90 year lease extension. Identical homes in Fulwood and Elston with 100 year plus lease were valued around £225,400. The average ground rent payable was £45 collected quarterly. The lease elapsed in 2089. Given that there were 64 years remaining we approximated the premium to the landlord to extend the lease to be between £15,200 and £17,600 not including costs.