The re-sale value of a leasehold property in Lake is impacted by how many years the lease has left to run. If it is near to or fewer than eighty years you should expect problems on re-sale, so it is advisable to arrange for a lease extension ahead of purchasing. It is ideal to start the lease extension process when the lease still has 82 years unexpired so that a lease extension can be addressed well before the eighty year mark. Leasehold Reform legislation entitles Lake qualifying lessees to a ninety year extension added to their unexpired lease term (ie if your lease has 50 years left the statutory lease extension will provide a new term of 140 years). The purpose of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be worth the same as 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
Regardless of whether you are a tenant or a landlord in Lake,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Lake valuers.
After unsuccessful discussions with the landlord of her garden apartment in Lake, Amber commenced the lease extension process just as her lease was approaching the crucial 80-year threshold. The legal work was concluded in April 2011. The landlord’s fees were negotiated to below 600 pounds.
Dr M García moved into a one bedroom flat in Lake in May 1998. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be to extend the lease by a further 90 years. Similar residencies in Lake with 100 year plus lease were valued around £285,000. The average ground rent payable was £45 collected per annum. The lease terminated on 20 January 2097. Given that there were 71 years left we calculated the compensation to the freeholder to extend the lease to be within £12,400 and £14,200 plus legals.
Last Autumn we were e-mailed by Dr S Peterson , who acquired a garden flat in Lake in November 2000. We are asked if we could approximate the compensation to the landlord could be to extend the lease by an additional years. Similar residencies in Lake with a long lease were in the region of £225,800. The average ground rent payable was £60 billed monthly. The lease ended on 19 October 2086. Considering the 60 years as a residual term we estimated the compensation to the freeholder for the lease extension to be within £23,800 and £27,400 exclusive of costs.