The re-sale value of a leasehold property in Rufford depends on how many years the lease has remaining. If it is near to or less than 80 years you should expect problems on re-sale, so it is advisable to arrange for the lease to be extended ahead of purchasing. It is ideal to start the process of extending the lease is when a lease still has 82 years unexpired so that formalities can be concluded in advance of the eighty year threshold. Leasehold Reform legislation entitles Rufford qualifying lessees to acquire a lease extension of ninety 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 determine the sum payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold residencies in Rufford with more than one hundred years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
The conveyancing solicitors that we work with handle Rufford 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.
Ibrahim was the the leasehold proprietor of a conversion apartment in Rufford on the market with a lease of a little over 72 years remaining. Ibrahim on an informal basis approached his landlord a well known local-based freehold company for a lease extension. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £200 per annum. No ground rent would be due on a lease extension were Ibrahim to exercise his statutory right. Ibrahim procured expert legal guidance and secured satisfactory deal without resorting to tribunal and sell the property.
Last year we were called by Ms Nicole Fournier , who owned a basement apartment in Rufford in November 2008. We are asked if we could estimate the premium would be to prolong the lease by an additional years. Comparable properties in Rufford with a long lease were valued about £205,000. The average amount of ground rent was £50 invoiced quarterly. The lease concluded in 2105. Considering the 79 years as a residual term we approximated the compensation to the landlord to extend the lease to be within £8,600 and £9,800 not including legals.
In 2011 we were approached by Mr and Mrs. F Cox who, having owned a purpose-built apartment in Rufford in June 2009. We are asked if we could estimate the price would be to prolong the lease by ninety years. Comparative residencies in Rufford with a long lease were in the region of £275,000. The average ground rent payable was £65 billed per annum. The lease ended in 2094. Taking into account 68 years unexpired we estimated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 not including professional charges.