The market value of a leasehold property in Biddenham is impacted by how long the lease has left to run. If it is near to or less than 80 years you should expect problems on re-sale, so it is advisable to arrange for a lease extension before purchasing. Ideally one should start the lease extension process when a lease still has 82 years unexpired so that a lease extension can be concluded well before the eighty year mark. Statute enables Biddenham qualifying lessees to an additional term of ninety years over and above the remaining term, at a nominal rent (zero ground rent). The purpose of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the acquisition of the lease extension.
It is generally considered that a property with in excess of 100 years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 35 years left, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
The conveyancing solicitors that we work with procure Biddenham 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.
Following lengthy correspondence with the freeholder of her first floor apartment in Biddenham, Mollie initiated the lease extension process as the eighty year threshold was fast coming. The lease extension was concluded in May 2011. The freeholder’s charges were kept to an absolute minimum.
Last Christmas we were called by Mr Sebastian Wood , who owned a first floor flat in Biddenham in September 2009. We are asked if we could shed any light on how much (approximately) price could be for a 90 year extension to my lease. Identical premises in Biddenham with a long lease were in the region of £200,800. The mid-range amount of ground rent was £65 billed quarterly. The lease ended on 5 June 2085. Taking into account 60 years unexpired we approximated the premium to the landlord for the lease extension to be between £20,900 and £24,200 not including legals.
In 2010 we were called by Mr Milo Bertrand who, having bought a studio apartment in Biddenham in July 2001. The dilemma was if we could approximate the price could be to prolong the lease by an additional years. Identical flats in Biddenham with a long lease were valued around £260,000. The average amount of ground rent was £50 collected monthly. The lease expired on 2 February 2096. Having 71 years unexpired we approximated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 plus costs.