The market value of a leasehold property in Rise Park is impacted by how long the lease has remaining. If it is near to or less than eighty years you should anticipate difficulties on re-sale, so it is recommended to arrange for a lease extension before purchasing. Ideally one should start the process of extending the lease is when a lease still has 82 years remaining so that a lease extension can be addressed in advance of the eighty year threshold. Leasehold Reform legislation enables Rise Park qualifying lessees to a ninety year extension added to their remaining lease term (ie if your lease has fifty years remaining the statutory lease extension will provide a new term of 140 years). The intention of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
It is generally considered that a property with over 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 30 years unexpired, the premises will be equivalent in value to 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service gives you enhanced control over the value of your Rise Park leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Last year Mason, started to get close to the 80-year threshold with the lease on his one bedroom flat in Rise Park. In buying his flat 18 years previously, the unexpired term was of minimal concern. As luck would have it, it dawned on him that he needed to take action soon on a lease extension. Mason was able to extend his lease just in the nick of time in March. Mason and the freeholder in the end settled on sum of £5,500 . If the lease had fallen lower than eighty years, the sum would have gone up by a minimum £1,000.
Dr Owen Turner completed a garden apartment in Rise Park in May 2001. We are asked if we could estimate the premium would likely be to extend the lease by a further 90 years. Comparable residencies in Rise Park with 100 year plus lease were valued about £240,600. The average amount of ground rent was £65 collected yearly. The lease expired in 2088. Considering the 62 years left we estimated the compensation to the freeholder to extend the lease to be within £21,900 and £25,200 not including legals.
An example of a Lease Extension case for a Rise Park residence is Flat b 14 Kemble Road in May 2014. The Tribunal assessed the value of the premium payable for the lease extension to be £9,761 This case related to 1 flat.