The market value of Shotley Bridge 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 escalate significantly once the unexpired lease term is below than 80 years
Leasehold properties in Shotley Bridge with in excess of 100 years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and service charges justify it.
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
Lease extensions in Shotley Bridge can be a difficult process. We recommend you obtain professional help from a lawyer and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Shotley Bridge lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
During the course of the last few months Hugo, started to get near to the 80-year threshold with the lease on his garden flat in Shotley Bridge. In buying his home two decades ago, the unexpired term was of little importance. Luckily, he became aware that he would imminently be paying way over the odds for Extending the lease. Hugo extended the lease at the eleventh hour last September. Hugo and the freeholder in the end agreed on an amount of £5,000 . If the lease had slipped below 80 years, the premium would have become more exhorbitant by at least £950.
In 2010 we were phoned by Dr Melissa Cook who, having acquired a ground floor apartment in Shotley Bridge in April 2012. We are asked if we could estimate the compensation to the landlord could be for a ninety year extension to my lease. Similar residencies in Shotley Bridge with a long lease were worth £255,000. The average amount of ground rent was £50 billed every twelve months. The lease expired in 2097. Given that there were 71 years outstanding we approximated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 exclusive of costs.
Last Summer we were e-mailed by Dr Archie Cook , who was assigned a lease of a one bedroom flat in Shotley Bridge in September 2012. We are asked if we could estimate the price would likely be for a 90 year lease extension. Comparable homes in Shotley Bridge with an extended lease were valued about £254,200. The mid-range ground rent payable was £60 invoiced every twelve months. The lease expired on 10 May 2077. Having 51 years unexpired we approximated the premium to the landlord for the lease extension to be between £43,700 and £50,600 plus legals.