The re-sale value of a leasehold property in Tetbury is impacted by how long the lease has left to run. If it is near to or less than eighty years you should foresee difficulties on re-sale, so it is recommended to arrange for the lease to be extended ahead of purchasing. It is preferable to start the lease extension process when the lease still has 82 years to run so that a lease extension can be finalised ahead of the eighty year threshold. Current legislation entitles Tetbury qualifying lessees to obtain a lease extension of 90 years on top of the remaining lease term at a peppercorn rent (that is, rent free). The intention of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold residencies in Tetbury with in excess of one hundred years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges warrant it.
| 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. |
| 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with procure Tetbury 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 lawyer we work with provide it.
Trailing lengthy negotiations with the landlord of her purpose-built apartment in Tetbury, Abigail commenced the lease extension process just as the lease was nearing the all-important 80-year threshold. The lease extension completed in September 2010. The freeholder’s fees were kept to an absolute minimum.
In 2013 we were called by Mr and Mrs. S Baker who, having purchased a first floor flat in Tetbury in October 1996. The question was if we could estimate the price could be for a 90 year extension to my lease. Similar homes in Tetbury with an extended lease were valued about £168,800. The average ground rent payable was £60 collected yearly. The lease expired on 7 May 2080. Having 55 years left we approximated the premium to the freeholder to extend the lease to be between £31,400 and £36,200 not including costs.
Last year we were called by Dr Ethan Wood , who owned a garden flat in Tetbury in October 2008. We are asked if we could approximate the compensation to the landlord would likely be for a ninety year extension to my lease. Identical homes in Tetbury with a long lease were in the region of £235,200. The mid-range ground rent payable was £45 invoiced yearly. The lease elapsed in 2091. Given that there were 66 years left we calculated the premium to the landlord for the lease extension to be within £12,400 and £14,200 not including expenses.