Hunstanton residential property owned on a long lease is a depreciating asset because a leaseholder only owns the property for a period of years.
It is conventional wisdom that a property with more than one hundred years remaining is worth roughly the equivalent as a freehold. Where an further ninety years added to any lease with more than 30 years unexpired, the residence will be equivalent in value to a freehold for many years ahead.
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
Irrespective of whether you are a tenant or a landlord in Hunstanton,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Hunstanton valuers.
James was the the leasehold proprietor of a studio flat in Hunstanton on the market with a lease of a few days over 61 years unexpired. James on an informal basis spoke with his landlord a well known London-based freehold company for a lease extension. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £100 per annum and increase every 25 years thereafter. No ground rent would be payable on a lease extension were James to exercise his statutory right. James procured expert advice and was able to make a more informed decision and handle with the matter and ending up with a market value flat.
Mr Logan Gunderson was assigned a lease of a purpose-built apartment in Hunstanton in March 2002. We are asked if we could estimate the price could be to prolong the lease by 90 years. Similar flats in Hunstanton with an extended lease were worth £223,400. The mid-range ground rent payable was £60 billed annually. The lease concluded on 27 February 2085. Taking into account 59 years outstanding we approximated the premium to the landlord for the lease extension to be between £27,600 and £31,800 plus expenses.
Mrs Alicia Hill owned a first floor apartment in Hunstanton in August 2003. We are asked if we could approximate the compensation to the landlord would be to prolong the lease by an additional years. Similar properties in Hunstanton with a long lease were valued around £205,000. The mid-range ground rent payable was £50 collected per annum. The lease finished in 2105. Taking into account 79 years left we estimated the premium to the landlord for the lease extension to be within £8,600 and £9,800 not including expenses.