The only way is down when it comes to Pickering lease terms. Pickering leaseholds that have a lease term less than than 80 years will drop in value even faster, and the cost to extend your lease will go up.
It is conventional wisdom that a residential leasehold with over one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 35 years left, the property will be equivalent in value to a freehold for many years ahead.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| 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 handle Pickering 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 conveyancer we work with provide it.
Two years ago Alfie, came critically near to the 80-year threshold with the lease on his studio apartment in Pickering. Having bought his home 19 years previously, the length of the lease was of little bearing. Thankfully, he realised he would imminently be paying way over the odds for a lease extension. Alfie extended the lease just in the nick of time last April. Alfie and the landlord who owned the flat above subsequently settled on the final figure of £6,000 . If the lease had dipped below 80 years, the premium would have escalated by a minimum £850.
In 2014 we were contacted by Ms Alice Brown who, having owned a one bedroom apartment in Pickering in August 1999. The question was if we could estimate the compensation to the landlord would be for a 90 year lease extension. Comparative properties in Pickering with 100 year plus lease were in the region of £254,200. The mid-range amount of ground rent was £60 invoiced yearly. The lease lapsed in 2076. Given that there were 51 years as a residual term we calculated the compensation to the freeholder for the lease extension to be between £43,700 and £50,600 exclusive of fees.
Mrs U Rose acquired a garden apartment in Pickering in August 2008. We are asked if we could estimate the price would be to extend the lease by 90 years. Comparable premises in Pickering with a long lease were worth £210,600. The mid-range ground rent payable was £45 billed annually. The lease came to a finish in 2087. Having 62 years remaining we approximated the premium to the freeholder to extend the lease to be between £18,100 and £20,800 exclusive of fees.