Goring residential property owned on a long lease is a depreciating asset because a leaseholder only owns the property for a period of years.
Leasehold premises in Goring with over one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| 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 |
The conveyancing solicitors 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 conveyancer we work with provide it.
16 months ago Reuben, started to get close to the eighty-year mark with the lease on his purpose- built flat in Goring. Having purchased his home two decades ago, the unexpired term was of minimal interest. Thankfully, he became aware that he would soon be paying an escalated premium for a lease extension. Reuben was able to extend his lease at the eleventh hour in September. Reuben and the freeholder via the management company eventually agreed on a premium of £6,000 . If he had missed the deadline, the premium would have escalated by a minimum £975.
Last Summer we were called by Mr Noah Bonnet , who acquired a garden apartment in Goring in October 1996. We are asked if we could estimate the compensation to the landlord would likely be to prolong the lease by a further 90 years. Similar residencies in Goring with 100 year plus lease were worth £250,400. The average ground rent payable was £65 invoiced yearly. The lease terminated on 12 February 2089. Having 64 years remaining we estimated the premium to the freeholder for the lease extension to be between £19,000 and £22,000 exclusive of expenses.
Last month we were phoned by Mrs B Moreau , who moved into a studio apartment in Goring in January 1996. The question was if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Comparative properties in Goring with a long lease were worth £184,000. The mid-range amount of ground rent was £55 collected yearly. The lease concluded in 2078. Having 53 years remaining we approximated the compensation to the freeholder for the lease extension to be between £28,500 and £33,000 plus costs.