The re-sale value of a leasehold property in Rowley Regis is impacted by how long the lease has left to run. If it is close 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 unexpired so that formalities can be concluded prior to the 80 year threshold. Leasehold Reform legislation enables Rowley Regis qualifying lessees to obtain a lease extension of 90 years on top of 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 premium payable by the lessee to the freeholder for the acquisition of the lease extension.
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Godiva Mortgages | 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| 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. |
| Yorkshire 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. |
Irrespective of whether you are a tenant or a landlord in Rowley Regis,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Rowley Regis valuers.
In the wake of 9 months of protracted negotiations with the freeholder of her purpose-built apartment in Rowley Regis, Jade commenced the lease extension process just as the lease was coming close to the all-important 80-year deadline. The legal work was finalised in March 2009. The landlord’s fees were kept to an absolute minimum.
In 2011 we were called by Mr L Norbert who, having moved into a purpose-built flat in Rowley Regis in August 2001. We are asked if we could estimate the premium would likely be to extend the lease by 90 years. Comparable residencies in Rowley Regis with a long lease were valued around £210,600. The mid-range amount of ground rent was £45 billed annually. The lease terminated in 2088. Given that there were 62 years left we calculated the compensation to the landlord for the lease extension to be within £18,100 and £20,800 not including legals.
In 2010 we were e-mailed by Mr and Mrs. E Roberts who, having took over the lease of a basement flat in Rowley Regis in March 2007. The question was if we could estimate the premium would likely be to prolong the lease by 90 years. Identical premises in Rowley Regis with a long lease were in the region of £260,000. The mid-range amount of ground rent was £50 billed yearly. The lease concluded on 4 November 2099. Having 73 years as a residual term we estimated the premium to the landlord to extend the lease to be between £9,500 and £11,000 plus expenses.