The market value of a leasehold property in Nantwich is impacted by how long the lease has remaining. If it is near to or fewer than eighty years you should expect problems on re-sale, so it is recommended to arrange for the lease to be extended prior to buying. It is preferable to commence the process of extending the lease is when the lease still has 82 years to run so that all matters can be addressed prior to the eighty year threshold. Current legislation entitles Nantwich 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 intention 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 conventional wisdom that a property with more than one hundred years remaining is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence 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. |
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 Nantwich leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Dylan, started to get close to the eighty-year threshold with the lease on his two bedroom apartment in Nantwich. Having bought his property twenty years ago, the unexpired term was of no relevance. Luckily, he noticed he would soon be paying an escalated premium for Extending the lease. Dylan extended the lease at the eleventh hour last May. Dylan and the freeholder via the managing agents ultimately agreed on an amount of £5,500 . If he not met the deadline, the price would have become more exhorbitant by a minimum £1,000.
Mr and Mrs. M Cox moved into a basement flat in Nantwich in October 2005. We are asked if we could approximate the premium would likely be for a 90 year lease extension. Similar residencies in Nantwich with an extended lease were valued around £295,000. The mid-range amount of ground rent was £45 collected every twelve months. The lease terminated on 26 November 2100. Given that there were 74 years remaining we approximated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 not including professional charges.
Last Christmas we were e-mailed by Dr Elijah Watson , who was assigned a lease of a first floor apartment in Nantwich in March 2004. The question was if we could approximate the compensation to the landlord could be for a ninety year lease extension. Similar homes in Nantwich with an extended lease were worth £243,000. The mid-range amount of ground rent was £65 billed quarterly. The lease ran out on 21 November 2089. Taking into account 63 years unexpired we estimated the premium to the freeholder for the lease extension to be within £20,000 and £23,000 not including expenses.