The value of Yarm leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can escalate significantly once the remaining term is less than eighty years
It is conventional wisdom that a property with more than 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 30 years left, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Coventry Building Society | 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 |
| 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. |
Retaining our service gives you better control over the value of your Yarm leasehold, as your property will be more valuable and marketable in relation to the 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.
16 months ago Oliver, started to get close to the 80-year mark with the lease on his one bedroom apartment in Yarm. Having bought his home two decades ago, the lease term was of no relevance. Thankfully, it dawned on him that he would imminently be paying an inflated amount for a lease extension. Oliver extended the lease at the eleventh hour in September. Oliver and the freeholder via the management company subsequently agreed on a premium of £5,000 . If he failed to meet the deadline, the figure would have gone up by at least £1,025.
In 2012 we were phoned by Mr and Mrs. D David who, having took over the lease of a recently refurbished apartment in Yarm in June 2005. The question was if we could approximate the premium would be for a 90 year extension to my lease. Comparative properties in Yarm with 100 year plus lease were valued about £205,000. The average ground rent payable was £50 collected monthly. The lease terminated in 2103. Considering the 78 years left we calculated the premium to the landlord to extend the lease to be between £8,600 and £9,800 not including fees.
Last Winter we were e-mailed by Mr and Mrs. V Davies , who moved into a garden apartment in Yarm in April 2001. The dilemma was if we could approximate the compensation to the landlord would likely be to prolong the lease by an additional years. Identical properties in Yarm with an extended lease were valued around £267,600. The average ground rent payable was £65 billed quarterly. The lease finished in 2092. Considering the 67 years left we approximated the premium to the freeholder for the lease extension to be between £14,300 and £16,400 exclusive of costs.