Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will normally be granted for a prescribed period of time , usually 99 or 125 years, although we have seen longer and shorter terms in Stroud. Clearly, the period of lease left reduces over time. This is often overlooked and only becomes a problem when the flat or house needs to be disposed of or refinanced. The fewer the years remaining the less it is worth and the more expensive it will be to extend the lease. Eligible long lease owners in Stroud have the legal entitlement to extend the lease for a further ninety years under Leasehold Reform legislation. Please give due deliberation before putting off your Stroud lease extension. Holding off that expense now simply increases the price you will ultimately incur to extend your lease
It is conventional wisdom that a property with over 100 years remaining is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years ahead.
| 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; |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
Regardless of whether you are a tenant or a freeholder in Stroud,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Stroud valuers.
Trailing lengthy negotiations with the freeholder of her basement flat in Stroud, Millie initiated the lease extension process just as her lease was nearing the all-important 80-year threshold. The legal work completed in September 2013. The freeholder’s fees were negotiated to under 600 GBP.
Last Winter we were called by Mr and Mrs. T Clarke , who was assigned a lease of a purpose-built apartment in Stroud in November 2004. The question was if we could approximate the premium would be to extend the lease by ninety years. Similar residencies in Stroud with 100 year plus lease were valued about £208,200. The average amount of ground rent was £65 collected monthly. The lease came to a finish on 23 July 2086. Having 61 years outstanding we estimated the compensation to the freeholder to extend the lease to be within £19,000 and £22,000 exclusive of legals.
Last month we were e-mailed by Mr K Wilson , who completed a ground floor flat in Stroud in October 2008. The question was if we could estimate the price could be for a ninety year extension to my lease. Comparative premises in Stroud with a long lease were worth £260,000. The mid-range ground rent payable was £50 billed monthly. The lease finished on 8 October 2097. Taking into account 72 years as a residual term we calculated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 exclusive of costs.