The re-sale value of a leasehold property in Presteigne is impacted by how long the lease has remaining. If it is close to or fewer than 80 years you should foresee difficulties on re-sale, so it is advisable to arrange for a lease extension before purchasing. It is preferable to start the process of extending the lease is when a lease still has 82 years remaining so that all matters can be addressed ahead of the 80 year threshold. Current legislation enables Presteigne qualifying lessees to a ninety year extension added to their remaining lease term (ie if your lease has fifty years left the statutory lease extension will provide a new term of 140 years). The reason of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold residencies in Presteigne with in excess of 100 years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges merit it.
| 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with handle Presteigne 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 conveyancing solicitor we work with provide it.
In the wake of 9 months of lengthy discussions with the landlord of her ground floor flat in Presteigne, Gemma initiated the lease extension process as the eighty year mark was fast advancing. The transaction was concluded in April 2012. The landlord’s charges were kept to an absolute minimum.
In 2011 we were phoned by Dr F Young who, having was assigned a lease of a basement flat in Presteigne in March 2002. The question was if we could approximate the price would be for a ninety year extension to my lease. Comparable homes in Presteigne with 100 year plus lease were valued about £183,600. The average ground rent payable was £65 billed per annum. The lease ran out in 2082. Taking into account 57 years outstanding we approximated the compensation to the landlord for the lease extension to be between £28,500 and £33,000 not including legals.
Dr I Turner purchased a studio flat in Presteigne in March 2012. The dilemma was if we could shed any light on how much (roughly) premium could be for a ninety year lease extension. Comparative flats in Presteigne with 100 year plus lease were in the region of £245,000. The average ground rent payable was £50 billed quarterly. The lease terminated in 2093. Having 68 years left we approximated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 not including legals.