The re-sale value of a leasehold property in Tintagel is impacted by how many years the lease has remaining. If it is near to or less than eighty years you should envisage problems on re-sale, so it is recommended to arrange for a lease extension ahead of purchasing. It is ideal to start the lease extension process when the lease still has 82 years unexpired so that a lease extension can be finalised prior to the eighty year threshold. Leasehold Reform legislation entitles Tintagel qualifying lessees to acquire a new lease which will be for the balance of the existing lease plus a supplemental term of 90 years. The purpose of the valuation is to determine the sum payable by the lessee to the freeholder for the acquisition of the lease extension.
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years unexpired, the property will be worth the same as a freehold for decades to come.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
Using our service gives you increased control over the value of your Tintagel leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
After lengthy discussions with the landlord of her studio flat in Tintagel, Ashleigh commenced the lease extension process just as her lease was nearing the critical eighty-year threshold. The legal work was concluded in April 2009. The landlord’s fees were restricted to a tad over six hundred pounds.
In 2010 we were contacted by Mrs Elizabeth Reed who, having completed a basement flat in Tintagel in October 1999. We are asked if we could shed any light on how much (roughly) price would be for a ninety year extension to my lease. Identical residencies in Tintagel with a long lease were valued about £200,000. The mid-range ground rent payable was £50 invoiced per annum. The lease finished on 22 February 2103. Having 77 years outstanding we calculated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 exclusive of professional charges.
In 2012 we were contacted by Dr Lydia Rivera who, having was assigned a lease of a studio apartment in Tintagel in September 2008. The dilemma was if we could approximate the compensation to the landlord could be to extend the lease by 90 years. Similar homes in Tintagel with an extended lease were valued around £260,200. The average amount of ground rent was £65 invoiced yearly. The lease ended in 2092. Having 66 years as a residual term we approximated the premium to the landlord to extend the lease to be between £16,200 and £18,600 exclusive of costs.