Yate residential property owned on a long lease is a wasting asset as the leaseholder only owns the property for a set term.
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth approximately the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Halifax | Minimum 70 years from the date 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
Using our service will provide you increased control over the value of your Yate leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Trailing protracted correspondence with the landlord of her two bedroom flat in Yate, Jodie commenced the lease extension process as the 80 year deadline was quickly coming. The lease extension was finalised in February 2013. The freeholder’s charges were negotiated to slightly above 500 GBP.
Last Christmas we were called by Mrs Charlotte Evans , who purchased a garden flat in Yate in September 2001. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be for a 90 year extension to my lease. Comparative residencies in Yate with a long lease were valued about £184,000. The average ground rent payable was £55 invoiced annually. The lease ended in 2079. Having 53 years outstanding we approximated the premium to the freeholder for the lease extension to be between £28,500 and £33,000 plus costs.
In 2014 we were called by Mr and Mrs. M Alexander who, having purchased a first floor flat in Yate in October 2002. We are asked if we could shed any light on how much (roughly) premium would be for a 90 year lease extension. Comparative flats in Yate with 100 year plus lease were valued around £290,000. The average amount of ground rent was £45 invoiced per annum. The lease ended in 2099. Having 73 years left we calculated the premium to the landlord to extend the lease to be within £9,500 and £11,000 not including legals.