The re-sale value of a leasehold property in Totland is impacted by how long the lease has remaining. If it is close to or less than eighty years you should envisage difficulties on re-sale, so it is advisable to arrange for the lease to be extended before buying. Ideally one should start the process of extending the lease is when the lease still has 82 years remaining so that formalities can be concluded in advance of the eighty year threshold. Statute entitles Totland qualifying lessees to obtain a new lease which will be for the current unexpired lease term plus an additional term of 90 years. The reason of the valuation is to determine the premium payable by the lessee to the freeholder for the purchase 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 same as a freehold. Where an additional 90 years added to any lease with more than 45 years left, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Engaging our service gives you enhanced control over the value of your Totland leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Oliver was the the leasehold proprietor of a conversion apartment in Totland on the market with a lease of a little over 59 years outstanding. Oliver on an informal basis spoke with his freeholder a well known local-based freehold company and enquired on a premium to extend the lease. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £50 per annum. No ground rent would be due on a lease extension were Oliver to exercise his statutory right. Oliver obtained expert legal guidance and secured an acceptable deal without going to tribunal and readily saleable.
Last Autumn we were phoned by Mr and Mrs. O James , who acquired a ground floor flat in Totland in February 2007. The question was if we could approximate the price would likely be to extend the lease by a further 90 years. Comparative homes in Totland with a long lease were in the region of £246,800. The mid-range ground rent payable was £60 billed quarterly. The lease terminated on 19 September 2076. Considering the 50 years as a residual term we estimated the premium to the landlord for the lease extension to be between £44,700 and £51,600 plus professional charges.
Mr and Mrs. G Richardson was assigned a lease of a ground floor flat in Totland in June 2009. The question was if we could shed any light on how much (approximately) price would likely be for a ninety year lease extension. Identical premises in Totland with 100 year plus lease were worth £208,200. The mid-range ground rent payable was £65 collected monthly. The lease end date was on 14 March 2087. Considering the 61 years unexpired we estimated the premium to the landlord for the lease extension to be between £20,000 and £23,000 exclusive of professional charges.