Ormskirk residential property owned on a long lease is a depreciating asset because a leaseholder merely owns the property for a set term.
It is generally accepted that a property with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to any lease with more than 45 years remaining, 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Chelsea 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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. |
Regardless of whether you are a tenant or a freeholder in Ormskirk,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Ormskirk valuers.
Half a year ago Harrison, started to get close to the eighty-year threshold with the lease on his purpose- built flat in Ormskirk. In buying his property 18 years previously, the lease term was of no bearing. Thankfully, it dawned on him that he needed to take action soon on Extending the lease. Harrison was able to extend his lease just ahead of time in July. Harrison and the landlord ultimately settled on a premium of £5,500 . If the lease had dipped lower than 80 years, the price would have increased by a minimum £1,075.
In 2013 we were approached by Mrs Chloe Ricardo who, having moved into a studio flat in Ormskirk in July 2008. The question was if we could estimate the premium would be to prolong the lease by an additional years. Comparative homes in Ormskirk with a long lease were valued around £208,200. The mid-range ground rent payable was £65 invoiced quarterly. The lease concluded on 19 May 2087. Considering the 61 years as a residual term we estimated the compensation to the landlord to extend the lease to be between £19,000 and £22,000 not including professional charges.
Mr and Mrs. P Bell took over the lease of a studio apartment in Ormskirk in October 2003. The dilemma was if we could estimate the price would likely be to extend the lease by ninety years. Comparable residencies in Ormskirk with an extended lease were valued about £260,000. The average ground rent payable was £50 billed quarterly. The lease elapsed on 7 July 2098. Taking into account 72 years remaining we estimated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 not including costs.