Witham residential property held on a long lease is a depreciating asset because a leaseholder merely owns the property for a period of years.
It is conventional wisdom that a property with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 30 years unexpired, the property will be worth the same as a freehold for many years in the future.
| 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; |
| 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. |
| Yorkshire 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. |
Irrespective of whether you are a tenant or a landlord in Witham,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Witham valuers.
Off the back of lengthy correspondence with the landlord of her studio apartment in Witham, Alicia commenced the lease extension process as the 80 year threshold was quickly approaching. The lease extension completed in January 2012. The landlord’s costs were restricted to less than 450 GBP.
In 2011 we were contacted by Ms I Campbell who, having bought a newly refurbished flat in Witham in November 1999. We are asked if we could approximate the price could be for a ninety year lease extension. Identical flats in Witham with an extended lease were worth £235,200. The mid-range amount of ground rent was £45 collected every twelve months. The lease concluded in 2092. Given that there were 66 years remaining we approximated the compensation to the freeholder for the lease extension to be within £12,400 and £14,200 plus legals.
Mr N Rivera acquired a studio flat in Witham in March 2009. We are asked if we could shed any light on how much (approximately) price would likely be to prolong the lease by an additional years. Comparable residencies in Witham with an extended lease were in the region of £275,000. The average ground rent payable was £55 invoiced yearly. The lease lapsed in 2103. Having 77 years unexpired we calculated the premium to the freeholder to extend the lease to be between £13,300 and £15,400 not including professional charges.