The re-sale value of a leasehold property in New Milton is impacted by how many years the lease has left to run. If it is close to or fewer than eighty years you should envisage problems on re-sale, so it is recommended to arrange for a lease extension prior to buying. Ideally one should start the process of extending the lease is when a lease still has 82 years unexpired so that formalities can be concluded well before the 80 year mark. Statute entitles New Milton qualifying lessees to an additional term of 90 years in addition to the remaining term, at a peppercorn rent (zero ground rent). The reason of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Godiva Mortgages | 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service gives you enhanced control over the value of your New Milton leasehold, as your property will be more valuable and saleable in respect of lease length should you wish to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of lengthy negotiations with the landlord of her purpose-built apartment in New Milton, Yasmin initiated the lease extension process just as the lease was nearing the crucial 80-year deadline. The lease extension was finalised in October 2010. The landlord’s fees were kept to an absolute minimum.
Mr Caleb Smith purchased a basement apartment in New Milton in January 1995. We are asked if we could approximate the premium would be to extend the lease by a further 90 years. Identical homes in New Milton with an extended lease were worth £270,000. The mid-range amount of ground rent was £55 billed every twelve months. The lease came to a finish in 2101. Having 75 years left we estimated the compensation to the freeholder for the lease extension to be within £9,500 and £11,000 exclusive of legals.
Mr and Mrs. S Michel bought a purpose-built flat in New Milton in April 2006. The question was if we could approximate the compensation to the landlord would be to extend the lease by a further 90 years. Comparative properties in New Milton with 100 year plus lease were in the region of £173,800. The average amount of ground rent was £65 invoiced yearly. The lease finished in 2081. Taking into account 55 years as a residual term we estimated the compensation to the freeholder for the lease extension to be within £31,400 and £36,200 plus expenses.