The market value of Oldland leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can increase materialy once the unexpired lease term is less than eighty years
Leasehold residencies in Oldland with more than one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with undertake Oldland 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 lawyer we work with provide it.
Theo owned a 2 bedroom apartment in Oldland being marketed with a lease of a little over 72 years left. Theo informally approached his landlord being a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent to start with set at £100 per annum and doubled every twenty five years thereafter. No ground rent would be payable on a lease extension were Theo to exercise his statutory right. Theo obtained expert legal guidance and was able to make a more informed judgement and deal with the matter and ending up with a market value flat.
In 2010 we were e-mailed by Mr and Mrs. N Williams who, having acquired a one bedroom flat in Oldland in November 1999. We are asked if we could approximate the compensation to the landlord could be for a 90 year lease extension. Similar properties in Oldland with 100 year plus lease were worth £184,000. The mid-range ground rent payable was £55 billed monthly. The lease finished on 8 May 2079. Given that there were 53 years outstanding we calculated the compensation to the landlord to extend the lease to be between £28,500 and £33,000 exclusive of fees.
Dr Milo Bertrand purchased a one bedroom flat in Oldland in May 1995. The dilemma was if we could shed any light on how much (roughly) premium could be to prolong the lease by 90 years. Similar properties in Oldland with a long lease were worth £290,000. The mid-range ground rent payable was £45 invoiced annually. The lease ran out in 2099. Considering the 73 years as a residual term we approximated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 plus fees.