The market value of Tadley leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can increase materialy once the unexpired lease term is less than eighty years
It is generally accepted that a property with more than 100 years remaining is worth roughly the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
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The conveyancers that we work with handle Tadley 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 conveyancer we work with provide it.
Arthur owned a 2 bedroom flat in Tadley being sold with a lease of fraction over sixty years remaining. Arthur on an informal basis contacted his landlord being a well known Bristol-based freehold company for a lease extension. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £150 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Arthur to invoke his statutory right. Arthur procured expert legal guidance and secured satisfactory deal without going to tribunal and readily saleable.
Last August we were approach by Mr and Mrs. J Taylor , who acquired a garden apartment in Tadley in August 1995. We are asked if we could estimate the compensation to the landlord could be for a ninety year extension to my lease. Comparative flats in Tadley with a long lease were valued around £227,800. The mid-range amount of ground rent was £45 billed quarterly. The lease end date was in 2091. Given that there were 65 years unexpired we estimated the compensation to the freeholder to extend the lease to be within £13,300 and £15,400 not including expenses.
Mr and Mrs. H Jones moved into a basement flat in Tadley in March 2005. The question was if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Comparative residencies in Tadley with a long lease were in the region of £275,000. The mid-range ground rent payable was £55 billed quarterly. The lease ran out on 16 May 2102. Taking into account 76 years outstanding we calculated the premium to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of expenses.