Norwich residential property held on a long lease is a depreciating asset as the leaseholder merely owns the property for a set term.
It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with procure Norwich 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 conveyancer we work with provide it.
In the wake of eight months of unsuccessful discussions with the landlord of her studio apartment in Norwich, Madeleine commenced the lease extension process just as her lease was coming close to the all-important 80-year mark. The transaction completed in June 2014. The freeholder’s fees were kept to an absolute minimum.
Mr B Davies bought a garden flat in Norwich in February 1997. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be to prolong the lease by a further 90 years. Similar properties in Norwich with an extended lease were valued around £280,000. The average amount of ground rent was £45 invoiced monthly. The lease came to a finish in 2096. Having 70 years as a residual term we estimated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of costs.
In 2012 we were e-mailed by Mr and Mrs. A Bertrand who, having owned a one bedroom apartment in Norwich in June 2000. We are asked if we could estimate the compensation to the landlord would likely be for a ninety year extension to my lease. Comparative residencies in Norwich with 100 year plus lease were valued about £223,400. The mid-range ground rent payable was £60 billed yearly. The lease concluded on 23 January 2085. Having 59 years unexpired we estimated the compensation to the landlord to extend the lease to be within £27,600 and £31,800 exclusive of legals.