The value of Peak District leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can escalate substantially once the unexpired lease term is below than eighty years
It is generally considered that a residential leasehold with over 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 45 years left, the premises 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
The conveyancers that we work with procure Peak District 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.
Last Christmas Luke, started to get close to the eighty-year mark with the lease on his purpose- built apartment in Peak District. In buying his flat two decades ago, the lease term was of no interest. As luck would have it, he became aware that he would soon be paying an inflated amount for Extending the lease. Luke arranged for a lease extension just under the wire last July. Luke and the freeholder ultimately agreed on the final figure of £5,000 . If the lease had dropped lower than eighty years, the figure would have become more costly by at least £925.
Dr Thomas Kelly was assigned a lease of a one bedroom flat in Peak District in August 2002. The dilemma was if we could shed any light on how much (approximately) price would likely be for a 90 year extension to my lease. Similar residencies in Peak District with an extended lease were worth £285,000. The mid-range amount of ground rent was £55 collected quarterly. The lease came to a finish in 2105. Having 79 years unexpired we approximated the premium to the freeholder to extend the lease to be between £13,300 and £15,400 plus expenses.
Last Summer we were contacted by Mr and Mrs. A García , who took over the lease of a one bedroom flat in Peak District in April 2011. The question was if we could estimate the premium could be for a ninety year extension to my lease. Comparative homes in Peak District with a long lease were in the region of £198,400. The average amount of ground rent was £65 billed annually. The lease lapsed on 11 January 2085. Taking into account 59 years unexpired we calculated the compensation to the landlord for the lease extension to be within £21,900 and £25,200 exclusive of expenses.