Owning a flat usually means owning a lease of the property, which has a set term of years. The lease will usually be granted for a set period of time , usually 99 or 125 years, although we have come across longer and shorter terms in New Forest. Inevitably, the term of lease left shortens over time. This may slip by relatively unnoticed when the flat or house has to be sold or refinanced. The fewer the years remaining the less it is worth and the more it will cost to extend the lease. Qualifying long lease owners in New Forest have the legal entitlement to extend the lease for a further ninety years under legislation. You should give careful deliberation before putting off your New Forest lease extension. Putting off that expense now simply increases the price you will eventually have to pay for a lease extension
It is generally accepted that a property with more than one hundred years remaining is worth approximately the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a freeholder in New Forest,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with New Forest valuers.
Muhammad owned a high value apartment in New Forest on the market with a lease of just over fifty eight years left. Muhammad informally spoke with his freeholder a well known local-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent to start with set at £200 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Muhammad to exercise his statutory right. Muhammad procured expert legal guidance and secured satisfactory deal informally and sell the flat.
Mr and Mrs. F Wilson moved into a one bedroom flat in New Forest in May 1995. We are asked if we could estimate the compensation to the landlord would likely be for a ninety year lease extension. Comparable residencies in New Forest with an extended lease were worth £250,000. The average amount of ground rent was £50 collected every twelve months. The lease expired in 2095. Given that there were 69 years remaining we estimated the premium to the landlord for the lease extension to be within £9,500 and £11,000 plus legals.
In 2010 we were called by Dr B Adams who, having was assigned a lease of a one bedroom apartment in New Forest in May 2010. The dilemma was if we could estimate the compensation to the landlord would be for a 90 year extension to my lease. Comparative residencies in New Forest with a long lease were worth £285,000. The mid-range amount of ground rent was £55 invoiced every twelve months. The lease terminated on 28 January 2106. Having 80 years as a residual term we approximated the premium to the landlord to extend the lease to be between £12,400 and £14,200 plus expenses.