The value of Benfleet leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can escalate substantially once the unexpired lease term is below than 80 years
It is generally accepted that a property with in excess of one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 30 years unexpired, the premises 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Benfleet can be a difficult process. We recommend you obtain professional help from a conveyancer and valuer with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Benfleet lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Luke owned a studio flat in Benfleet on the market with a lease of fraction over 59 years unexpired. Luke on an informal basis contacted his landlord a well known London-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of an increased rent to £50 annually. Ordinarily, ground rent would not be due on a lease extension were Luke to exercise his statutory right. Luke procured expert advice and secured satisfactory deal without resorting to tribunal and ending up with a market value flat.
Last Winter we were called by Mrs R Reed , who purchased a basement apartment in Benfleet in March 1998. We are asked if we could estimate the price would likely be for a ninety year lease extension. Comparable homes in Benfleet with an extended lease were in the region of £218,000. The average amount of ground rent was £45 collected every twelve months. The lease elapsed on 4 May 2088. Considering the 63 years outstanding we approximated the premium to the landlord to extend the lease to be between £17,100 and £19,800 not including expenses.
Dr V Baker took over the lease of a newly refurbished apartment in Benfleet in January 2009. We are asked if we could approximate the compensation to the landlord would be to prolong the lease by ninety years. Similar flats in Benfleet with 100 year plus lease were valued about £265,000. The average amount of ground rent was £50 collected annually. The lease ended on 14 July 2099. Considering the 74 years as a residual term we estimated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 exclusive of expenses.