Trowbridge Estate leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease becomes more expensive. It is the case that most Trowbridge Estate tenants have the right to extend their lease by an additional 90 years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in Trowbridge Estate you should check if your lease has between seventy and ninety years left. In particular once the remaining lease term slips under 80 years, the amount payable for any lease extension increases dramatically as part of the premium you will incur is what is known as a marriage value
Leasehold properties in Trowbridge Estate with over 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges justify it.
| 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. |
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage 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. |
Engaging our service gives you enhanced control over the value of your Trowbridge Estate leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to unsuccessful correspondence with the landlord of her first floor apartment in Trowbridge Estate, Anna started the lease extension process as the 80 year deadline was quickly approaching. The legal work completed in June 2009. The freeholder’s costs were restricted to under 550 pounds.
Last August we were approach by Ms I Clarke , who completed a purpose-built apartment in Trowbridge Estate in April 2000. We are asked if we could estimate the premium would likely be for a ninety year lease extension. Comparative residencies in Trowbridge Estate with 100 year plus lease were in the region of £264,000. The mid-range amount of ground rent was £60 collected monthly. The lease termination date was in 2079. Given that there were 53 years left we estimated the premium to the freeholder for the lease extension to be between £37,100 and £42,800 not including legals.
Mr and Mrs. N Williams acquired a first floor flat in Trowbridge Estate in June 2006. We are asked if we could estimate the price would likely be for a 90 year extension to my lease. Identical residencies in Trowbridge Estate with an extended lease were worth £220,400. The average amount of ground rent was £45 billed per annum. The lease terminated in 2090. Given that there were 64 years unexpired we approximated the premium to the freeholder for the lease extension to be between £16,200 and £18,600 exclusive of expenses.