The market value of a leasehold property in Stockwood is impacted by how many years the lease has remaining. If it is close to or fewer than 80 years you should envisage difficulties on re-sale, so it is recommended to arrange for the lease to be extended prior to buying. It is ideal to start the lease extension process when a lease still has 82 years remaining so that formalities can be concluded in advance of the 80 year mark. Current legislation enables Stockwood qualifying lessees to acquire a new lease which will be for the balance of the existing lease plus an additional term of 90 years. The intention of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold properties in Stockwood with in excess of 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth 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 maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Retaining our service will provide you increased control over the value of your Stockwood leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Harvey, started to get close to the eighty-year threshold with the lease on his garden flat in Stockwood. Having bought his property two decades ago, the unexpired term was of no concern. Luckily, he realised he would soon be paying an escalated premium for Extending the lease. Harvey arranged for a lease extension at the eleventh hour last August. Harvey and the freeholder via the management company ultimately settled on sum of £5,000 . If the lease had gone lower than 80 years, the sum would have gone up by a minimum £950.
Last Christmas we were e-mailed by Mrs P Cox , who took over the lease of a one bedroom flat in Stockwood in January 2008. The question was if we could approximate the premium would likely be for a ninety year extension to my lease. Identical residencies in Stockwood with an extended lease were worth £176,200. The mid-range ground rent payable was £65 invoiced every twelve months. The lease came to a finish on 11 January 2081. Having 56 years remaining we calculated the premium to the freeholder to extend the lease to be between £29,500 and £34,000 plus costs.
Mr Kyle Harris completed a purpose-built apartment in Stockwood in March 1999. The question was if we could estimate the price would likely be to prolong the lease by a further 90 years. Comparative properties in Stockwood with an extended lease were worth £237,600. The average ground rent payable was £45 billed yearly. The lease finished in 2092. Considering the 67 years left we estimated the premium to the landlord to extend the lease to be between £11,400 and £13,200 plus expenses.