The market value of a leasehold property in Gedling depends on how long the lease has left to run. If it is near to or less than eighty years you should anticipate problems on re-sale, so it is advisable to arrange for a lease extension before buying. Ideally one should start the process of extending the lease is when a lease still has 82 years unexpired so that formalities can be concluded well before the 80 year mark. Leasehold Reform legislation enables Gedling qualifying lessees to acquire a new lease which will be for the balance of the existing lease plus an additional term of ninety years. The intention of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
It is generally considered that a property with more than 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| Lloyds TSB Scotland | 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. |
| Yorkshire 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. |
The conveyancing solicitors that we work with procure 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 conveyancer we work with provide it.
Last year John, came precariously close to the 80-year mark with the lease on his one bedroom flat in Gedling. In buying his property twenty years previously, the lease term was of minimal importance. Fortunately, he realised he needed to take steps soon on a lease extension. John was able to extend his lease just ahead of time in July. John and the freeholder via the management company ultimately agreed on a premium of £5,500 . If the lease had slipped below eighty years, the amount would have become more exhorbitant by a minimum £1,075.
Mr and Mrs. V Ward completed a ground floor flat in Gedling in May 2003. The dilemma was if we could estimate the premium could be for a 90 year extension to my lease. Identical premises in Gedling with 100 year plus lease were in the region of £205,000. The mid-range ground rent payable was £50 collected per annum. The lease came to a finish in 2104. Having 79 years unexpired we estimated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 not including expenses.
Last Summer we were approach by Dr J Jackson , who acquired a purpose-built flat in Gedling in November 2005. The dilemma was if we could approximate the price could be to prolong the lease by a further 90 years. Comparative flats in Gedling with an extended lease were valued around £275,000. The mid-range ground rent payable was £65 invoiced quarterly. The lease lapsed on 19 February 2093. Taking into account 68 years as a residual term we estimated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 plus fees.