The market value of a leasehold property in Little Haven is impacted by how long the lease has remaining. If it is close to or less than 80 years you should expect difficulties on re-sale, so it is advisable to arrange for a lease extension prior to purchasing. It is ideal to start the lease extension process when the lease still has 82 years to run so that a lease extension can be addressed prior to the eighty year threshold. Statute enables Little Haven qualifying lessees to a 90 year extension added to their unexpired lease term (ie if your lease has fifty years remaining the statutory lease extension will provide a new term of 140 years). The purpose of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 35 years remaining, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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; |
| Godiva Mortgages | 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| Yorkshire 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. |
The lawyers that we work with undertake Little Haven 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 conveyancing solicitor we work with provide it.
Last Summer Daniel, started to get near to the eighty-year mark with the lease on his two bedroom apartment in Little Haven. In buying his home two decades ago, the lease term was of minimal bearing. Fortunately, he realised he needed to take action soon on Extending the lease. Daniel extended the lease just ahead of time in August. Daniel and the freeholder subsequently settled on a premium of £5,000 . If he failed to meet the deadline, the premium would have gone up by at least £925.
Dr M Rivera was assigned a lease of a ground floor apartment in Little Haven in July 2005. We are asked if we could approximate the compensation to the landlord could be for a ninety year lease extension. Identical flats in Little Haven with 100 year plus lease were worth £275,000. The mid-range ground rent payable was £55 collected per annum. The lease expired on 19 April 2103. Given that there were 77 years unexpired we approximated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 plus costs.
In 2009 we were called by Mr Sebastian Sánchez who, having moved into a studio flat in Little Haven in June 1999. We are asked if we could shed any light on how much (roughly) price could be for a ninety year extension to my lease. Identical residencies in Little Haven with an extended lease were valued about £183,600. The average ground rent payable was £65 collected every twelve months. The lease concluded in 2083. Given that there were 57 years unexpired we calculated the compensation to the landlord for the lease extension to be between £28,500 and £33,000 not including legals.