The market value of The Borough 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 increase substantially once the remaining term is below than eighty years
It is generally accepted that a residential leasehold with over one hundred years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 30 years remaining, the residence 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Lease extensions in The Borough can be a difficult process. We recommend you procure professional help from a conveyancing solicitor and surveyor with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with The Borough lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Twenty four months ago Mason, came seriously near to the 80-year mark with the lease on his garden flat in The Borough. Having bought his flat two decades ago, the length of the lease was of minimal concern. Fortunately, he recognised he would imminently be paying an inflated amount for Extending the lease. Mason was able to extend his lease just under the wire last July. Mason and the freeholder via the management company subsequently settled on sum of £5,500 . If he failed to meet the deadline, the sum would have gone up by a minimum £1,100.
Last Summer we were contacted by Ms F James , who took over the lease of a studio flat in The Borough in February 1997. We are asked if we could approximate the price would be to extend the lease by 90 years. Similar properties in The Borough with a long lease were in the region of £235,200. The mid-range amount of ground rent was £45 billed per annum. The lease elapsed on 9 July 2091. Given that there were 66 years as a residual term we approximated the compensation to the freeholder to extend the lease to be within £12,400 and £14,200 plus professional charges.
In 2012 we were called by Mr Matthew Sánchez who, having owned a ground floor flat in The Borough in July 2007. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to extend the lease by an additional years. Comparable flats in The Borough with a long lease were in the region of £275,000. The average amount of ground rent was £55 collected per annum. The lease came to a finish in 2102. Having 77 years outstanding we calculated the premium to the freeholder for the lease extension to be between £13,300 and £15,400 not including legals.