The market value of a leasehold property in Tickton is impacted by how many years the lease has remaining. If it is near to or less than 80 years you should envisage difficulties on re-sale, so it is recommended to arrange for the lease to be extended ahead of buying. It is preferable to start the lease extension process when a lease still has 82 years remaining so that formalities can be concluded in advance of the eighty year threshold. Leasehold Reform legislation enables Tickton qualifying lessees to a ninety year extension added to their residual lease term (ie if your lease has 50 years left the statutory lease extension will provide a new term of 140 years). The intention of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with undertake Tickton 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.
Half a year ago Leon, came perilously near to the eighty-year threshold with the lease on his leasehold flat in Tickton. Having purchased his flat twenty years ago, the length of the lease was of little relevance. Fortunately, he realised he needed to take steps soon on Extending the lease. Leon extended the lease just in the nick of time last September. Leon and the landlord who owned the flat above eventually agreed on the final figure of £5,500 . If he failed to meet the deadline, the premium would have increased by at least £925.
In 2012 we were called by Mr Leon Howard who, having moved into a studio flat in Tickton in October 2006. The dilemma was if we could approximate the price would likely be for a 90 year extension to my lease. Comparative residencies in Tickton with 100 year plus lease were worth £191,400. The average amount of ground rent was £55 invoiced every twelve months. The lease terminated in 2080. Given that there were 54 years outstanding we calculated the premium to the freeholder for the lease extension to be within £34,200 and £39,600 not including fees.
Last Spring we were approach by Ms K Lambert , who was assigned a lease of a first floor flat in Tickton in February 2003. We are asked if we could shed any light on how much (roughly) premium would be for a ninety year lease extension. Comparative homes in Tickton with a long lease were valued around £295,000. The mid-range amount of ground rent was £45 billed monthly. The lease ran out in 2100. Given that there were 74 years left we approximated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 not including expenses.