On the balance of probabilities where you own a flat in Gloucester you actually own a long leasehold interest over your property
Leasehold residencies in Gloucester with more than 100 years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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. |
| Leeds Building Society | 85 years remaining from the start 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
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 respect of lease length should you wish to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Last Christmas Alfie, came perilously close to the 80-year mark with the lease on his garden flat in Gloucester. In buying his home 19 years previously, the lease term was of minimal importance. by good luck, he realised he would soon be paying an escalated premium for a lease extension. Alfie was able to extend his lease at the eleventh hour last July. Alfie and the freeholder via the managing agents subsequently agreed on a premium of £5,500 . If he had missed the deadline, the amount would have increased by at least £1,075.
Last Spring we were approach by Dr B Sharif , who owned a newly refurbished flat in Gloucester in February 2006. The question was if we could approximate the premium could be for a ninety year extension to my lease. Identical flats in Gloucester with a long lease were in the region of £205,000. The average amount of ground rent was £50 invoiced every twelve months. The lease came to a finish in 2105. Given that there were 79 years remaining we calculated the compensation to the freeholder to extend the lease to be between £7,600 and £8,800 exclusive of expenses.
In 2011 we were called by Dr L Parker who, having bought a studio flat in Gloucester in February 2009. The dilemma was if we could approximate the compensation to the landlord would be to prolong the lease by ninety years. Comparative residencies in Gloucester with an extended lease were in the region of £270,000. The average amount of ground rent was £65 billed yearly. The lease end date was in 2094. Having 68 years left we estimated the premium to the freeholder to extend the lease to be within £12,400 and £14,200 exclusive of legals.