The value of Kingswood leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can increase materialy once the remaining term is less than eighty years
Leasehold properties in Kingswood with over one hundred years left on the lease are often referred to as ‘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 to be gained by buying the freehold unless savings on ground rent and service charges warrant 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. |
| 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Using our service gives you better control over the value of your Kingswood leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Alexander was the the leasehold proprietor of a high value flat in Kingswood on the market with a lease of fraction over fifty eight years unexpired. Alexander informally contacted his landlord being a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a rise in the rent to £200 per annum. Ordinarily, ground rent would not be due on a lease extension were Alexander to invoke his statutory right. Alexander obtained expert legal guidance and secured satisfactory deal without going to tribunal and sell the property.
Dr S Davies completed a first floor flat in Kingswood in June 2000. We are asked if we could estimate the premium would be for a ninety year extension to my lease. Similar properties in Kingswood with an extended lease were valued around £191,400. The mid-range ground rent payable was £55 invoiced quarterly. The lease finished in 2079. Considering the 54 years outstanding we calculated the compensation to the landlord to extend the lease to be within £27,600 and £31,800 exclusive of fees.
In 2013 we were called by Dr Samuel Laurent who, having took over the lease of a one bedroom flat in Kingswood in February 2001. We are asked if we could estimate the premium could be for a ninety year lease extension. Similar homes in Kingswood with a long lease were in the region of £290,000. The average ground rent payable was £45 invoiced every twelve months. The lease came to a finish on 19 April 2099. Taking into account 74 years left we estimated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 not including legals.