The market value of a leasehold property in Turvey depends on how long the lease has remaining. If it is close to or fewer than eighty years you should envisage problems on re-sale, so it is recommended to arrange for a lease extension prior to buying. It is ideal to start the process of extending the lease is when the lease still has 82 years unexpired so that formalities can be addressed prior to the 80 year threshold. Current legislation enables Turvey qualifying lessees to obtain a lease extension of 90 years in addition to the remaining lease term at a peppercorn rent (that is, rent free). The intention of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold residencies in Turvey with more than 100 years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges merit 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
The lawyers that we work with handle Turvey 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 lawyer we work with provide it.
Jayden owned a 2 bedroom flat in Turvey being marketed with a lease of fraction over fifty eight years remaining. Jayden informally approached his freeholder a well known London-based freehold company for a lease extension. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent to start with set at £200 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Jayden to exercise his statutory right. Jayden obtained expert legal guidance and was able to make an informed decision and handle with the matter and ending up with a market value flat.
Last month we were phoned by Mr and Mrs. S Flores , who purchased a first floor apartment in Turvey in September 1995. We are asked if we could estimate the compensation to the landlord would likely be to prolong the lease by ninety years. Identical premises in Turvey with a long lease were worth £245,000. The average amount of ground rent was £45 collected per annum. The lease terminated on 6 May 2094. Having 68 years as a residual term we calculated the premium to the landlord for the lease extension to be within £9,500 and £11,000 plus costs.
Last Summer we were approach by Dr C Sharif , who bought a purpose-built flat in Turvey in February 2008. The dilemma was if we could estimate the price would likely be to prolong the lease by an additional years. Comparable homes in Turvey with an extended lease were worth £285,000. The average ground rent payable was £55 invoiced monthly. The lease expired on 10 October 2105. Taking into account 79 years as a residual term we estimated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 plus legals.