Kempsey residential property owned on a long lease is a depreciating asset as the leaseholder only owns the property for a set term.
Leasehold residencies in Kempsey with in excess of one hundred years remaining 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 property. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and estate 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with handle Kempsey 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.
Off the back of protracted correspondence with the freeholder of her studio apartment in Kempsey, Laura started the lease extension process as the eighty year deadline was fast approaching. The legal work was finalised in May 2014. The landlord’s costs were kept to an absolute minimum.
Dr P García bought a one bedroom flat in Kempsey in August 2007. We are asked if we could estimate the compensation to the landlord would be to prolong the lease by an additional years. Comparative residencies in Kempsey with 100 year plus lease were valued around £184,000. The average ground rent payable was £55 billed quarterly. The lease expired in 2078. Considering the 53 years outstanding we calculated the premium to the freeholder for the lease extension to be within £28,500 and £33,000 plus expenses.
Last Winter we were approach by Dr N Cox , who completed a garden apartment in Kempsey in November 1996. The question was if we could estimate the price would likely be for a 90 year extension to my lease. Similar properties in Kempsey with 100 year plus lease were valued around £290,000. The mid-range ground rent payable was £45 billed monthly. The lease ran out in 2098. Having 73 years outstanding we estimated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 not including expenses.