The market value of a leasehold property in Yarm depends on how long the lease has remaining. If it is close to or fewer than 80 years you should envisage difficulties on re-sale, so it is advisable to arrange for the lease to be extended prior to purchasing. It is ideal to start the process of extending the lease is when the lease still has 82 years unexpired so that all matters can be addressed well before the eighty year mark. Statute entitles Yarm qualifying lessees to obtain a lease extension of 90 years on top of the remaining length of the lease at a peppercorn rent (that is, rent free). The reason of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold properties in Yarm with more than one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
The conveyancers that we work with undertake Yarm 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 conveyancer we work with provide it.
Subsequent to unsuccessful negotiations with the landlord of her first floor apartment in Yarm, Francesca commenced the lease extension process as the eighty year mark was fast nearing. The lease extension was concluded in February 2005. The freeholder’s fees were kept to an absolute minimum.
In 2009 we were called by Mr and Mrs. K Roberts who, having completed a studio apartment in Yarm in May 2008. The dilemma was if we could shed any light on how much (approximately) price could be for a 90 year lease extension. Comparable flats in Yarm with a long lease were valued around £267,600. The mid-range ground rent payable was £65 invoiced quarterly. The lease finished in 2093. Taking into account 67 years outstanding we estimated the compensation to the freeholder for the lease extension to be between £14,300 and £16,400 not including expenses.
Last Summer we were e-mailed by Mr and Mrs. R Vincent , who owned a first floor apartment in Yarm in March 2010. The dilemma was if we could shed any light on how much (approximately) price would likely be for a ninety year lease extension. Identical homes in Yarm with an extended lease were in the region of £206,200. The mid-range ground rent payable was £60 billed monthly. The lease terminated in 2082. Having 56 years remaining we calculated the premium to the freeholder for the lease extension to be between £31,400 and £36,200 plus legals.