Tetbury Lease Extension - Free Consultation

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Why you should commence your Tetbury lease extension

Top reasons for lease extension now:

Increase your lease and increase your Tetbury property value

The market value of a leasehold property in Tetbury is impacted by how long the lease has left to run. If it is near to or fewer than 80 years you should envisage difficulties on re-sale, so it is advisable to arrange for a lease extension ahead of buying. It is preferable to start the lease extension process when the lease still has 82 years remaining so that formalities can be addressed ahead of the 80 year threshold. Leasehold Reform legislation enables Tetbury qualifying lessees to an additional term of 90 years in addition to the existing term, at a peppercorn rent (no ground rent). The reason of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.

Tetbury property with a lease extension has roughly the same value as a freehold

It is generally considered that a property with more than one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.

Banks and Building Societies may not finance a property on a short lease

The trend since over the last decade has been for mortgage companies to tighten lending requirements generally - this has extended to the property over which the mortgage is to be granted. This has meant the unexpired lease term required by mortgage companies has increased. In the past mortgage companies would grant a mortgage on a lease with twenty years plus the term of the loan - typically 50 year leases but those requirements have been chipped away by the requirement for longer and longer leases - many use a minimum term of 75 years as standard.

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.
Halifax Minimum 70 years from the date of the mortgage.
Leeds Building Society 85 years remaing from the start of the mortgage.
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.

Get in touch with one of our Tetbury lease extension solicitors or enfranchisement solicitors

Irrespective of whether you are a tenant or a landlord in Tetbury,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Tetbury valuers.

Tetbury Lease Extension Case Summaries:

Aaron, Tetbury, Gloucestershire,

Aaron owned a studio apartment in Tetbury being marketed with a lease of a little over sixty years outstanding. Aaron informally approached his freeholder being a well known Manchester-based freehold company for a lease extension. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £100 per annum. Ordinarily, ground rent would not be payable on a lease extension were Aaron to invoke his statutory right. Aaron procured expert legal guidance and secured satisfactory deal informally and ending up with a market value flat.

Tetbury case:

Last month we were contacted by Mr and Mrs. I Martinez , who purchased a purpose-built apartment in Tetbury in September 2005. The dilemma was if we could estimate the price would likely be for a ninety year lease extension. Comparative flats in Tetbury with a long lease were valued around £193,400. The average amount of ground rent was £65 billed yearly. The lease elapsed on 19 September 2081. Having 59 years left we approximated the premium to the landlord to extend the lease to be between £21,900 and £25,200 plus costs.

Tetbury case:

Mr and Mrs. K Bailey purchased a ground floor flat in Tetbury in August 2004. We are asked if we could estimate the price would be for a 90 year lease extension. Identical premises in Tetbury with a long lease were worth £255,000. The average amount of ground rent was £50 collected yearly. The lease ended in 2092. Having 70 years unexpired we approximated the compensation to the landlord for the lease extension to be between £10,500 and £12,000 not including fees.