New Forest leases on residential properties are gradually losing value. if your lease has about ninety years remaining, you should start considering the need for a lease extension. It is important to recognise that it is that it is desirable for a lease extension to be in place before the term of the existing lease falls lower than eighty years - otherwise a higher premium will be due. Flat owners in New Forest will usually qualify for a lease extension; however It would be wise to check with a conveyancer to confirm your eligibility. In some circumstances you may not be entitled. There are prescribed deadlines and formalities to follow once the process is initiated so it’s wise to be guided by a conveyancing solicitor during the process.
Leasehold properties in New Forest with more than 100 years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| Coventry Building Society | 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with procure New Forest 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.
Subsequent to unsuccessful correspondence with the landlord of her first floor flat in New Forest, Amy initiated the lease extension process as the eighty year mark was swiftly nearing. The lease extension was finalised in April 2007. The landlord’s fees were restricted to a tad over 450 GBP.
In 2013 we were called by Dr N David who, having purchased a newly refurbished flat in New Forest in January 2000. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to extend the lease by ninety years. Comparative premises in New Forest with an extended lease were valued around £186,000. The mid-range ground rent payable was £65 collected annually. The lease elapsed on 27 September 2084. Having 58 years outstanding we approximated the premium to the landlord for the lease extension to be between £24,700 and £28,600 not including professional charges.
Last October we were e-mailed by Mr Y Hill , who took over the lease of a one bedroom flat in New Forest in March 2000. We are asked if we could shed any light on how much (roughly) premium could be for a 90 year lease extension. Comparable homes in New Forest with 100 year plus lease were valued around £250,000. The mid-range ground rent payable was £50 invoiced yearly. The lease concluded in 2095. Considering the 69 years unexpired we approximated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 exclusive of expenses.