The re-sale value of a leasehold property in Norwood depends on how long the lease has remaining. If it is close to or less than eighty years you should foresee problems on re-sale, so it is recommended to arrange for a lease extension before purchasing. It is preferable to commence the process of extending the lease is when the lease still has 82 years unexpired so that formalities can be addressed in advance of the 80 year threshold. Statute entitles Norwood qualifying lessees to obtain a lease extension of ninety years on top of the remaining length of the lease at a peppercorn rent (that is, rent free). The purpose of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is generally accepted that a residential leasehold with over one hundred years remaining is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| 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 |
Lease extensions in Norwood can be a difficult process. We recommend you obtain professional help from a conveyancer and valuer with experience in this area.
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 Norwood lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Reuben owned a studio flat in Norwood on the market with a lease of fraction over 72 years remaining. Reuben informally contacted his freeholder a well known Manchester-based freehold company for a lease extension. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £150 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Reuben to invoke his statutory right. Reuben obtained expert advice and was able to make a more informed judgement and handle with the matter and ending up with a market value flat.
Last month we were phoned by Mr and Mrs. I Stewart , who completed a purpose-built apartment in Norwood in November 2004. The dilemma was if we could shed any light on how much (roughly) premium could be to extend the lease by ninety years. Comparative homes in Norwood with a long lease were valued about £260,000. The average ground rent payable was £50 collected monthly. The lease terminated in 2097. Considering the 71 years remaining we approximated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 not including fees.
Mr and Mrs. E Dupont was assigned a lease of a basement flat in Norwood in September 1996. The dilemma was if we could approximate the price would be for a 90 year extension to my lease. Comparative premises in Norwood with 100 year plus lease were in the region of £254,200. The mid-range ground rent payable was £60 billed per annum. The lease end date was on 25 February 2077. Having 51 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £43,700 and £50,600 exclusive of fees.