Coleford leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. Legislation has been in place for sometime now which permits qualifying Coleford residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Coleford you would be well advised to see if your lease has between 70 and ninety years remaining. There are good reasons why a Coleford flat owner with a lease having around eighty years unexpired should take action to make sure that a lease extension is actioned without delay
It is conventional wisdom that a property with in excess of 100 years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with handle Coleford 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.
Zachary owned a high value apartment in Coleford being sold with a lease of a few days over sixty years remaining. Zachary on an informal basis approached his landlord a well known Manchester-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of an increased rent to £200 annually. No ground rent would be payable on a lease extension were Zachary to invoke his statutory right. Zachary obtained expert advice and was able to make an informed decision and deal with the matter and readily saleable.
In 2013 we were phoned by Mr and Mrs. P Davies who, having was assigned a lease of a garden flat in Coleford in August 2001. We are asked if we could estimate the compensation to the landlord could be for a 90 year extension to my lease. Similar properties in Coleford with a long lease were valued around £275,000. The average ground rent payable was £45 invoiced per annum. The lease concluded on 21 August 2095. Given that there were 69 years left we estimated the premium to the landlord for the lease extension to be between £12,400 and £14,200 not including costs.
Last June we were called by Mr and Mrs. T Adams , who purchased a first floor flat in Coleford in August 2000. The dilemma was if we could estimate the premium could be to prolong the lease by an additional years. Comparable premises in Coleford with an extended lease were valued about £216,000. The average amount of ground rent was £60 invoiced monthly. The lease ended in 2084. Given that there were 58 years as a residual term we approximated the compensation to the freeholder to extend the lease to be between £28,500 and £33,000 exclusive of expenses.