The market value of a leasehold property in Shrivenham is impacted by how many years the lease has left to run. If it is near to or less than eighty years you should envisage difficulties on re-sale, so it is recommended to arrange for a lease extension before purchasing. It is preferable to start the lease extension process when a lease still has 82 years to run so that formalities can be finalised in advance of the 80 year cut off point. Current legislation enables Shrivenham qualifying lessees to a 90 year extension added to their remaining lease term (ie if your lease has 50 years left the statutory lease extension will provide a new term of 140 years). The purpose of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold premises in Shrivenham with over one hundred years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges merit 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; |
| 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with procure Shrivenham 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 conveyancing solicitor we work with provide it.
Kai was the the leasehold proprietor of a high value flat in Shrivenham being sold with a lease of just over fifty eight years outstanding. Kai informally spoke with his landlord being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £50 per annum. Ordinarily, ground rent would not be payable on a lease extension were Kai to invoke his statutory right. Kai procured expert legal guidance and secured satisfactory resolution informally and sell the flat.
Ms Megan Carter completed a first floor flat in Shrivenham in May 2008. We are asked if we could shed any light on how much (approximately) premium would be for a 90 year extension to my lease. Similar premises in Shrivenham with a long lease were valued about £210,600. The average amount of ground rent was £45 invoiced per annum. The lease terminated on 8 March 2087. Considering the 62 years left we estimated the compensation to the freeholder to extend the lease to be between £18,100 and £20,800 not including professional charges.
Mr and Mrs. N Roberts was assigned a lease of a one bedroom apartment in Shrivenham in September 2003. The dilemma was if we could estimate the compensation to the landlord would likely be to prolong the lease by 90 years. Identical residencies in Shrivenham with 100 year plus lease were in the region of £265,000. The mid-range ground rent payable was £50 billed quarterly. The lease lapsed in 2098. Having 73 years remaining we calculated the premium to the landlord for the lease extension to be between £9,500 and £11,000 plus professional charges.