The market value of a leasehold property in Maldon depends on how many years the lease has left to run. If it is near to or fewer than eighty years you should foresee difficulties on re-sale, so it is advisable to arrange for a lease extension before purchasing. It is preferable to start the process of extending the lease is when a lease still has 82 years unexpired so that a lease extension can be concluded ahead of the eighty year mark. Current legislation entitles Maldon qualifying lessees to obtain a new lease which will be for the balance of the existing lease plus an additional term of ninety years. The reason of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is generally considered that a residential leasehold with more than 100 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 property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | 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. |
| 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. |
Irrespective of whether you are a tenant or a landlord in Maldon,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Maldon valuers.
In 2014 Leon, came critically close to the eighty-year mark with the lease on his purpose- built flat in Maldon. Having purchased his flat 19 years previously, the unexpired term was of little relevance. Fortunately, it dawned on him that he needed to take steps soon on Extending the lease. Leon was able to extend his lease just in the nick of time last August. Leon and the freeholder via the management company eventually agreed on sum of £5,500 . If he failed to meet the deadline, the figure would have escalated by at least £1,075.
In 2012 we were called by Mr and Mrs. O Torres who, having took over the lease of a first floor flat in Maldon in August 1999. We are asked if we could shed any light on how much (roughly) premium would be for a 90 year extension to my lease. Similar properties in Maldon with 100 year plus lease were valued about £275,000. The average ground rent payable was £55 invoiced quarterly. The lease lapsed on 24 October 2101. Taking into account 76 years unexpired we estimated the premium to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of professional charges.
Last month we were approach by Mr and Mrs. W Bennett , who bought a one bedroom flat in Maldon in November 2007. The dilemma was if we could approximate the compensation to the landlord would likely be for a ninety year extension to my lease. Comparative properties in Maldon with an extended lease were in the region of £176,200. The mid-range amount of ground rent was £65 invoiced annually. The lease lapsed on 7 May 2081. Given that there were 56 years left we approximated the compensation to the landlord for the lease extension to be between £29,500 and £34,000 not including professional charges.