Yarm On Tees residential property owned on a long lease is a depreciating asset because a leaseholder only owns the property for a set term.
It is generally accepted that a property with in excess of 100 years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 35 years unexpired, the property 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 should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Irrespective of whether you are a tenant or a freeholder in Yarm On Tees,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 Yarm On Tees valuers.
16 months ago Isaac, started to get close to the eighty-year threshold with the lease on his purpose- built apartment in Yarm On Tees. Having purchased his home two decades ago, the length of the lease was of no importance. Fortunately, he noticed he would soon be paying an inflated amount for a lease extension. Isaac was able to extend his lease just ahead of time last January. Isaac and the freeholder via the managing agents in the end agreed on a premium of £5,500 . If he had missed the deadline, the premium would have gone up by at least £950.
Mr K Ricardo was assigned a lease of a ground floor flat in Yarm On Tees in March 2010. We are asked if we could approximate the compensation to the landlord would likely be to prolong the lease by a further 90 years. Comparative properties in Yarm On Tees with 100 year plus lease were in the region of £206,200. The average amount of ground rent was £55 collected quarterly. The lease came to a finish in 2081. Given that there were 56 years left we calculated the compensation to the landlord for the lease extension to be within £31,400 and £36,200 plus legals.
Mr K Morris bought a basement apartment in Yarm On Tees in May 2011. The dilemma was if we could shed any light on how much (roughly) price would be for a ninety year lease extension. Identical homes in Yarm On Tees with a long lease were valued around £300,000. The average ground rent payable was £50 collected monthly. The lease came to a finish on 26 June 2101. Having 76 years unexpired we calculated the premium to the landlord to extend the lease to be between £8,600 and £9,800 exclusive of professional charges.