The market value of a leasehold property in Gloucester depends on how long the lease has left to run. If it is near to or less than eighty years you should envisage difficulties on re-sale, so it is recommended to arrange for a lease extension prior to purchasing. Ideally one should start the process of extending the lease is when the lease still has 82 years unexpired so that all matters can be finalised ahead of the 80 year cut off point. Current legislation enables Gloucester 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 purpose of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
It is conventional wisdom that a residential leasehold with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 30 years unexpired, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service will provide you better control over the value of your Gloucester leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Ryan owned a studio apartment in Gloucester being sold with a lease of fraction over fifty eight years remaining. Ryan on an informal basis contacted his landlord being a well known Bristol-based freehold company for a lease extension. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £100 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Ryan to invoke his statutory right. Ryan obtained expert advice and was able to make an informed judgement and handle with the matter and ending up with a market value flat.
Last Autumn we were called by Mrs Ellie Clarke , who acquired a one bedroom flat in Gloucester in November 2010. We are asked if we could approximate the compensation to the landlord would be to extend the lease by an additional years. Comparable properties in Gloucester with a long lease were in the region of £265,200. The mid-range amount of ground rent was £65 invoiced annually. The lease elapsed on 27 September 2092. Taking into account 66 years as a residual term we calculated the compensation to the landlord for the lease extension to be within £15,200 and £17,600 plus legals.
Last year we were contacted by Ms U Alexander , who completed a first floor apartment in Gloucester in November 2011. We are asked if we could estimate the premium would likely be to prolong the lease by an additional years. Identical homes in Gloucester with an extended lease were worth £201,200. The mid-range amount of ground rent was £55 collected monthly. The lease expired on 18 July 2082. Considering the 56 years as a residual term we approximated the compensation to the freeholder to extend the lease to be within £31,400 and £36,200 exclusive of professional charges.