Chances are that where you own a flat in Great Shelford you actually own a long leasehold interest over your property
Leasehold premises in Great Shelford with over one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges merit it.
| 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 should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Engaging our service will provide you enhanced control over the value of your Great Shelford leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Michael was the the leasehold owner of a high value flat in Great Shelford on the market with a lease of just over sixty years remaining. Michael informally contacted his landlord a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Michael to exercise his statutory right. Michael procured expert legal guidance and was able to make an informed judgement and deal with the matter and ending up with a market value flat.
Last Winter we were contacted by Mrs Lucy Turner , who acquired a one bedroom flat in Great Shelford in March 2004. The question was if we could shed any light on how much (roughly) premium would likely be for a 90 year lease extension. Similar premises in Great Shelford with a long lease were valued about £275,000. The average amount of ground rent was £55 collected every twelve months. The lease lapsed in 2101. Given that there were 77 years outstanding we calculated the premium to the landlord to extend the lease to be between £13,300 and £15,400 not including expenses.
Last year we were called by Dr F Taylor , who took over the lease of a one bedroom apartment in Great Shelford in January 1995. We are asked if we could estimate the price would be for a 90 year extension to my lease. Similar homes in Great Shelford with 100 year plus lease were in the region of £183,600. The mid-range ground rent payable was £65 invoiced monthly. The lease concluded on 15 May 2081. Given that there were 57 years outstanding we estimated the compensation to the freeholder to extend the lease to be between £28,500 and £33,000 exclusive of fees.