The market value of a leasehold property in Grappenhall depends on how long the lease has remaining. If it is close to or fewer than eighty years you should expect difficulties on re-sale, so it is advisable to arrange for the lease to be extended prior to purchasing. Ideally one should start the lease extension process when a lease still has 82 years remaining so that formalities can be concluded well before the 80 year mark. Statute entitles Grappenhall qualifying lessees to an additional term of ninety years in addition to the unexpired term, at a notional rent (zero ground rent). The purpose of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 45 years remaining, the property will be worth the same as a freehold for many years in the future.
| 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; |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 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 Grappenhall,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Grappenhall valuers.
Following unsuccessful correspondence with the freeholder of her two bedroom flat in Grappenhall, Sophia started the lease extension process as the eighty year threshold was swiftly coming. The transaction was concluded in February 2005. The landlord’s costs were negotiated to less than 500 pounds.
Mr Isaac Campbell bought a studio flat in Grappenhall in August 2007. We are asked if we could approximate the price would likely be for a ninety year lease extension. Identical homes in Grappenhall with 100 year plus lease were valued about £250,000. The mid-range amount of ground rent was £50 collected yearly. The lease expiry date was on 8 January 2095. Having 69 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 exclusive of costs.
In 2014 we were e-mailed by Mr and Mrs. W François who, having moved into a recently refurbished apartment in Grappenhall in January 1995. We are asked if we could estimate the compensation to the landlord would likely be for a ninety year extension to my lease. Similar properties in Grappenhall with a long lease were worth £285,000. The average amount of ground rent was £55 collected monthly. The lease termination date was in 2106. Considering the 80 years remaining we estimated the premium to the landlord for the lease extension to be between £12,400 and £14,200 not including costs.