The market value of Newton Ferrers 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 escalate substantially once the unexpired lease term is less than eighty years
It is conventional wisdom that a residential leasehold with more than one hundred years remaining is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for decades to come.
| 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; |
| 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with procure Newton Ferrers 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.
Jonathan owned a studio apartment in Newton Ferrers on the market with a lease of just over fifty eight years remaining. Jonathan informally contacted his landlord being a well known Bristol-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 rise in the rent to £125 annually. Ordinarily, ground rent would not be payable on a lease extension were Jonathan to invoke his statutory right. Jonathan obtained expert legal guidance and was able to make an informed judgement and deal with the matter and sell the property.
Last Winter we were e-mailed by Dr Alfie Adams , who was assigned a lease of a purpose-built flat in Newton Ferrers in September 2011. We are asked if we could approximate the compensation to the landlord would be to extend the lease by an additional years. Comparable residencies in Newton Ferrers with a long lease were in the region of £290,000. The average ground rent payable was £60 collected every twelve months. The lease ran out in 2105. Given that there were 80 years as a residual term we calculated the premium to the landlord for the lease extension to be between £12,400 and £14,200 not including legals.
Last month we were contacted by Mrs Niamh Clarke , who was assigned a lease of a first floor flat in Newton Ferrers in March 2002. We are asked if we could shed any light on how much (approximately) price would be to prolong the lease by ninety years. Comparative residencies in Newton Ferrers with 100 year plus lease were worth £200,800. The mid-range amount of ground rent was £65 invoiced annually. The lease lapsed on 16 September 2085. Considering the 60 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £20,900 and £24,200 plus costs.