The market value of Tarporley 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 materialy once the remaining term is below than 80 years
It is generally considered that a property with more than 100 years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| 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 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. |
| 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 also be not less than 75 years at the outset of the mortgage. |
The lawyers that we work with procure Tarporley 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.
Half a year ago Harvey, came very near to the eighty-year threshold with the lease on his studio flat in Tarporley. In buying his flat twenty years ago, the length of the lease was of little bearing. Fortunately, he became aware that he needed to take steps soon on a lease extension. Harvey was able to extend his lease just in the nick of time in January. Harvey and the landlord who owned the flat above eventually agreed on sum of £5,500 . If he failed to meet the deadline, the amount would have escalated by at least £925.
In 2014 we were phoned by Mr and Mrs. L Nelson who, having bought a garden apartment in Tarporley in July 2001. We are asked if we could estimate the compensation to the landlord would be to extend the lease by ninety years. Comparable residencies in Tarporley with an extended lease were worth £174,200. The mid-range amount of ground rent was £55 collected quarterly. The lease expired on 27 January 2077. Given that there were 51 years unexpired we calculated the premium to the landlord for the lease extension to be within £31,400 and £36,200 not including professional charges.
In 2011 we were e-mailed by Mr Cameron Carter who, having purchased a basement flat in Tarporley in March 1996. The question was if we could shed any light on how much (roughly) compensation to the landlord could be for a 90 year lease extension. Identical properties in Tarporley with 100 year plus lease were valued about £285,000. The mid-range amount of ground rent was £45 billed per annum. The lease ran out on 2 September 2097. Considering the 71 years left we estimated the premium to the landlord for the lease extension to be within £12,400 and £14,200 not including professional charges.