The value of Gedling leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can escalate significantly once the remaining term is less than eighty years
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years remaining, the residence will be equivalent in value to 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with handle Gedling lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Half a year ago Noah, came perilously near to the eighty-year threshold with the lease on his two bedroom apartment in Gedling. In buying his home 19 years ago, the length of the lease was of little significance. Thankfully, he recognised he would imminently be paying an inflated amount for a lease extension. Noah arranged for a lease extension at the eleventh hour last April. Noah and the landlord ultimately agreed on an amount of £6,000 . If he not met the deadline, the sum would have become more exhorbitant by at least £1,000.
Last year we were e-mailed by Ms Y Bonnet , who acquired a first floor flat in Gedling in October 2000. The dilemma was if we could estimate the premium could be for a 90 year extension to my lease. Similar premises in Gedling with 100 year plus lease were worth £295,000. The mid-range ground rent payable was £45 invoiced annually. The lease ended in 2099. Given that there were 74 years outstanding we estimated the premium to the landlord to extend the lease to be within £8,600 and £9,800 not including professional charges.
Mr R Thompson purchased a first floor apartment in Gedling in October 2011. The question was if we could estimate the compensation to the landlord would be to extend the lease by an additional years. Similar flats in Gedling with 100 year plus lease were in the region of £243,000. The mid-range ground rent payable was £65 billed monthly. The lease ended in 2088. Taking into account 63 years left we calculated the premium to the landlord to extend the lease to be between £20,000 and £23,000 not including costs.