Goring leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Legislation has been in place for sometime now which permits qualifying Goring residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Goring you would be well advised to check if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension increases dramatically as part of the premium you pay is what is known as a marriage value
It is generally accepted that a residential leasehold with in excess of 100 years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 Goring 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.
In the wake of 9 months of lengthy correspondence with the freeholder of her leasehold flat in Goring, Lily commenced the lease extension process as the eighty year mark was swiftly coming. The lease extension was concluded in November 2013. The freeholder’s costs were negotiated to under 700 pounds.
Last Autumn we were e-mailed by Mrs D Moreau , who was assigned a lease of a studio apartment in Goring in June 1999. We are asked if we could estimate the premium would be to prolong the lease by a further 90 years. Comparable premises in Goring with a long lease were worth £233,200. The mid-range ground rent payable was £60 invoiced yearly. The lease terminated in 2087. Considering the 61 years as a residual term we calculated the premium to the landlord for the lease extension to be between £22,800 and £26,400 exclusive of fees.
Last year we were e-mailed by Mrs H Cook , who acquired a first floor apartment in Goring in February 1997. We are asked if we could shed any light on how much (roughly) premium would be to extend the lease by ninety years. Identical residencies in Goring with 100 year plus lease were in the region of £166,800. The average amount of ground rent was £50 collected yearly. The lease ended in 2076. Given that there were 50 years left we approximated the premium to the freeholder for the lease extension to be between £32,300 and £37,400 plus expenses.