The re-sale value of a leasehold property in Coulsdon is impacted by how long the lease has remaining. If it is near to or less than eighty years you should foresee difficulties on re-sale, so it is advisable to arrange for a lease extension prior to purchasing. It is preferable to commence the process of extending the lease is when the lease still has 82 years remaining so that a lease extension can be finalised in advance of the 80 year cut off point. Statute enables Coulsdon qualifying lessees to obtain a lease extension of ninety years in addition to 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 sum payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a property with over 100 years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be worth the same as a freehold for many years ahead.
| 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Regardless of whether you are a tenant or a landlord in Coulsdon,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Coulsdon valuers.
Caleb owned a studio flat in Coulsdon on the market with a lease of a little over 61 years remaining. Caleb informally contacted his landlord a well known London-based freehold company for a lease extension. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £50 per annum. No ground rent would be due on a lease extension were Caleb to exercise his statutory right. Caleb obtained expert legal guidance and secured an acceptable deal informally and ending up with a market value flat.
In 2009 we were approached by Mr and Mrs. J Lefèvre who, having took over the lease of a garden flat in Coulsdon in May 1998. The question was if we could shed any light on how much (approximately) price would be to extend the lease by 90 years. Comparative premises in Coulsdon with 100 year plus lease were worth £275,000. The average amount of ground rent was £55 invoiced monthly. The lease ended in 2102. Taking into account 76 years unexpired we calculated the premium to the landlord to extend the lease to be between £9,500 and £11,000 not including costs.
An example of a Freehold Enfranchisement decision for a Coulsdon residence is 223 Brighton Road in September 2013. The premium payable for the acquisition freehold of the properties should be £10,934 (Ten thousand,nine hundred and thirty four pounds) This case related to 3 flats. The unexpired term was 75 years.