The value of Pontefract leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can increase substantially once the unexpired lease term is less than eighty years
Leasehold residencies in Pontefract with over one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges justify it.
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Engaging our service gives you better control over the value of your Pontefract leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Jack owned a conversion apartment in Pontefract being marketed with a lease of a little over 72 years outstanding. Jack on an informal basis approached his landlord being a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £200 annually. Ordinarily, ground rent would not be due on a lease extension were Jack to exercise his statutory right. Jack obtained expert legal guidance and was able to make a more informed decision and deal with the matter and sell the property.
In 2012 we were phoned by Mr and Mrs. Y Watson who, having acquired a newly refurbished flat in Pontefract in November 1997. The question was if we could shed any light on how much (roughly) price would likely be to prolong the lease by an additional years. Comparative flats in Pontefract with an extended lease were valued about £235,200. The mid-range amount of ground rent was £45 billed per annum. The lease elapsed in 2091. Taking into account 66 years outstanding we approximated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 not including fees.
Last May we were phoned by Dr Jasmine Dupont , who bought a one bedroom apartment in Pontefract in July 2012. The question was if we could approximate the price would be to prolong the lease by a further 90 years. Identical premises in Pontefract with 100 year plus lease were valued about £275,000. The mid-range amount of ground rent was £55 invoiced every twelve months. The lease ran out in 2102. Taking into account 77 years left we estimated the premium to the landlord to extend the lease to be within £13,300 and £15,400 not including expenses.