For those whose Ottershaw property is held on a long lease, the message is clear – if no remedial action is taken, your property will ultimately revert to the freeholder, leaving you empty-handed. The shorter the lease the less it is worth and the more it will cost to extend the lease.
It is conventional wisdom that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | 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. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Yorkshire 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. |
Regardless of whether you are a tenant or a landlord in Ottershaw,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Ottershaw valuers.
In recent months Leo, came very near to the eighty-year mark with the lease on his two bedroom apartment in Ottershaw. In buying his property 19 years previously, the lease term was of no bearing. As luck would have it, he became aware that he needed to take action soon on Extending the lease. Leo arranged for a lease extension just under the wire last March. Leo and the landlord subsequently agreed on an amount of £5,500 . If the lease had gone lower than eighty years, the amount would have become more exhorbitant by a minimum £1,150.
In 2012 we were approached by Mr and Mrs. B Michel who, having bought a recently refurbished apartment in Ottershaw in July 2009. We are asked if we could estimate the price would likely be for a 90 year lease extension. Comparative homes in Ottershaw with 100 year plus lease were worth £257,800. The average ground rent payable was £65 billed per annum. The lease concluded on 6 July 2090. Taking into account 65 years outstanding we calculated the compensation to the landlord to extend the lease to be between £18,100 and £20,800 plus expenses.
Last Spring we were approach by Mr and Mrs. W Clark , who purchased a one bedroom apartment in Ottershaw in January 2012. We are asked if we could approximate the price would be to extend the lease by 90 years. Comparative properties in Ottershaw with a long lease were in the region of £191,400. The mid-range amount of ground rent was £55 collected per annum. The lease elapsed on 4 July 2079. Considering the 54 years remaining we calculated the compensation to the landlord to extend the lease to be between £34,200 and £39,600 not including fees.