Goodrich leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. Most owners of residential leasehold property in Goodrich enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Goodrich you must check if your lease has between seventy and ninety years left. There are compelling reasons why a Goodrich flat owner with a lease having around 80 years unexpired should take steps to make sure that a lease extension is put in place without delay
Leasehold residencies in Goodrich with over one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
Irrespective of whether you are a tenant or a landlord in Goodrich,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Goodrich valuers.
14 months ago Finn, came perilously close to the 80-year threshold with the lease on his leasehold flat in Goodrich. Having purchased his property 18 years ago, the lease term was of little concern. Luckily, he noticed he needed to take steps soon on Extending the lease. Finn arranged for a lease extension just ahead of time last May. Finn and the landlord who owned the flat above in the end agreed on the final figure of £6,000 . If the lease had slipped lower than eighty years, the amount would have become more costly by at least £1,000.
In 2009 we were e-mailed by Mr and Mrs. M Flores who, having owned a garden apartment in Goodrich in May 2009. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to extend the lease by an additional years. Comparative homes in Goodrich with an extended lease were valued around £295,000. The average amount of ground rent was £45 collected quarterly. The lease expired on 25 September 2101. Given that there were 75 years as a residual term we approximated the compensation to the landlord for the lease extension to be within £8,600 and £9,800 not including professional charges.
In 2012 we were called by Mrs Jennifer Ricardo who, having acquired a recently refurbished apartment in Goodrich in May 2004. We are asked if we could estimate the premium would likely be for a ninety year extension to my lease. Comparable residencies in Goodrich with 100 year plus lease were in the region of £250,400. The mid-range ground rent payable was £65 billed monthly. The lease expired on 20 August 2090. Taking into account 64 years as a residual term we estimated the premium to the landlord to extend the lease to be between £19,000 and £22,000 exclusive of costs.