The value of Nether Stowey leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can increase substantially once the remaining term is less than 80 years
It is conventional wisdom that a residential leasehold with in excess of one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 35 years remaining, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
The conveyancing solicitors that we work with undertake Nether Stowey 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 lawyer we work with provide it.
In the wake of 6 months of protracted correspondence with the landlord of her garden apartment in Nether Stowey, Naomi started the lease extension process as the eighty year threshold was quickly coming. The legal work was finalised in November 2012. The landlord’s costs were negotiated to about 650 pounds.
Mr and Mrs. V Rogers purchased a ground floor flat in Nether Stowey in August 2007. We are asked if we could approximate the premium could be to extend the lease by a further 90 years. Comparable residencies in Nether Stowey with an extended lease were valued about £295,000. The mid-range amount of ground rent was £45 billed quarterly. The lease came to a finish on 10 November 2099. Considering the 74 years as a residual term we estimated the compensation to the landlord for the lease extension to be between £8,600 and £9,800 plus expenses.
In 2009 we were contacted by Mr and Mrs. E Young who, having completed a one bedroom apartment in Nether Stowey in September 2010. The question was if we could shed any light on how much (approximately) compensation to the landlord could be to prolong the lease by a further 90 years. Identical flats in Nether Stowey with 100 year plus lease were valued about £243,000. The average amount of ground rent was £65 collected every twelve months. The lease concluded in 2088. Considering the 63 years outstanding we calculated the compensation to the landlord to extend the lease to be within £20,000 and £23,000 plus legals.