The market value of Newent leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can increase substantially once the remaining term is below than eighty years
Leasehold residencies in Newent with in excess of one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Yorkshire 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. |
Lease extensions in Newent can be a difficult process. We recommend you obtain guidance from a conveyancer and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Newent lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Alexander owned a high value apartment in Newent being sold with a lease of a little over sixty years remaining. Alexander informally approached his freeholder a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent initially set at £100 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Alexander to invoke his statutory right. Alexander procured expert advice and was able to make a more informed judgement and handle with the matter and sell the property.
In 2013 we were phoned by Dr B Bernard who, having took over the lease of a studio apartment in Newent in March 2005. We are asked if we could estimate the premium would likely be to prolong the lease by an additional years. Identical flats in Newent with a long lease were worth £191,400. The average ground rent payable was £55 billed monthly. The lease expiry date was in 2079. Given that there were 54 years unexpired we approximated the premium to the freeholder for the lease extension to be within £34,200 and £39,600 exclusive of professional charges.
Mr and Mrs. M Edwards was assigned a lease of a garden apartment in Newent in April 2002. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be for a 90 year lease extension. Similar residencies in Newent with 100 year plus lease were worth £295,000. The average amount of ground rent was £45 invoiced quarterly. The lease terminated on 21 January 2099. Having 74 years outstanding we approximated the compensation to the freeholder for the lease extension to be within £9,500 and £11,000 exclusive of professional charges.