Horfield leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease becomes more expensive. Most owners of residential leasehold property in Horfield enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Horfield you would be well advised to see if your lease has between 70 and ninety years remaining. There are compelling reasons why a Horfield leaseholder with a lease having around 80 years remaining should take steps to make sure that a lease extension is effected without delay
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| 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. |
Using our service gives you better control over the value of your Horfield leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
In recent months Leo, started to get close to the 80-year threshold with the lease on his studio flat in Horfield. In buying his property 18 years previously, the length of the lease was of no bearing. by good luck, it dawned on him that he would imminently be paying an inflated amount for a lease extension. Leo arranged for a lease extension at the eleventh hour last May. Leo and the landlord who owned the flat above ultimately settled on the final figure of £5,500 . If the lease had dropped below eighty years, the price would have become more costly by at least £1,025.
Mr and Mrs. E David was assigned a lease of a basement apartment in Horfield in August 2004. The question was if we could estimate the price would be for a ninety year extension to my lease. Similar homes in Horfield with a long lease were valued about £300,000. The mid-range ground rent payable was £50 collected quarterly. The lease finished in 2101. Having 76 years unexpired we estimated the premium to the landlord for the lease extension to be between £8,600 and £9,800 plus professional charges.
Mr and Mrs. C Collins took over the lease of a newly refurbished flat in Horfield in November 2010. We are asked if we could shed any light on how much (roughly) premium would likely be to prolong the lease by an additional years. Comparative properties in Horfield with an extended lease were worth £257,800. The average ground rent payable was £65 collected monthly. The lease came to a finish on 11 March 2090. Taking into account 65 years remaining we estimated the premium to the freeholder to extend the lease to be within £18,100 and £20,800 not including costs.