The value of Shirebrook leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can increase substantially once the unexpired lease term is less than 80 years
It is generally considered that a residential leasehold with in excess of 100 years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 30 years remaining, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| 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. |
| 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 Shirebrook,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 in-depth market knowledge and the close ties they enjoy with Shirebrook valuers.
Off the back of unsuccessful discussions with the landlord of her purpose-built apartment in Shirebrook, Daisy commenced the lease extension process just as her lease was coming close to the crucial 80-year threshold. The transaction was concluded in May 2009. The freeholder’s costs were negotiated to approximately 450 GBP.
In 2013 we were called by Mr Charlie Clarke who, having moved into a basement flat in Shirebrook in July 2000. The question was if we could shed any light on how much (approximately) compensation to the landlord could be for a ninety year lease extension. Comparable flats in Shirebrook with 100 year plus lease were worth £280,000. The average ground rent payable was £45 billed every twelve months. The lease finished in 2095. Considering the 70 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £12,400 and £14,200 plus professional charges.
Dr M Bailey acquired a one bedroom apartment in Shirebrook in January 1996. We are asked if we could estimate the price could be to prolong the lease by an additional years. Comparable properties in Shirebrook with a long lease were valued about £225,800. The average ground rent payable was £60 invoiced monthly. The lease came to a finish in 2085. Having 60 years remaining we calculated the compensation to the freeholder to extend the lease to be between £25,700 and £29,600 exclusive of legals.