The market value of a leasehold property in Romsey is impacted by how many years the lease has remaining. If it is near to or fewer than eighty years you should anticipate difficulties on re-sale, so it is advisable to arrange for a lease extension before buying. Ideally one should start the process of extending the lease is when the lease still has 82 years remaining so that formalities can be addressed in advance of the eighty year mark. Leasehold Reform legislation enables Romsey qualifying lessees to acquire a lease extension of ninety years in addition to the remaining length of the lease at a peppercorn rent (that is, rent free). The reason of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold premises in Romsey with in excess of one hundred years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 Romsey 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.
Subsequent to protracted correspondence with the landlord of her basement apartment in Romsey, Sian commenced the lease extension process just as her lease was approaching the crucial 80-year threshold. The transaction completed in September 2013. The landlord’s fees were kept to an absolute minimum.
In 2014 we were phoned by Dr William Vincent who, having moved into a first floor flat in Romsey in October 2007. We are asked if we could approximate the premium would be to extend the lease by a further 90 years. Comparative residencies in Romsey with an extended lease were valued around £166,400. The average amount of ground rent was £60 billed quarterly. The lease termination date was on 27 January 2079. Considering the 54 years as a residual term we calculated the premium to the freeholder to extend the lease to be between £32,300 and £37,400 plus professional charges.
Ms Victoria Morel owned a purpose-built apartment in Romsey in November 2000. We are asked if we could approximate the premium would likely be to prolong the lease by an additional years. Similar homes in Romsey with an extended lease were worth £227,800. The mid-range amount of ground rent was £45 billed monthly. The lease ran out on 6 March 2090. Having 65 years unexpired we estimated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 exclusive of costs.