For those whose Epping flat is held on a long lease, the message is clear – if nothing is done, your property will eventually revert to your landlord, leaving you empty-handed. The shorter the lease the lower the value of the property and the more expensive it will be to extend the lease.
It is generally accepted that a property with more than one hundred years remaining is worth roughly the equivalent 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 many years in the future.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
Retaining our service will provide you increased control over the value of your Epping leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Owen owned a conversion flat in Epping being marketed with a lease of fraction over 61 years remaining. Owen on an informal basis approached his freeholder being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Owen to exercise his statutory right. Owen obtained expert advice and was able to make a more informed judgement and deal with the matter and sell the flat.
In 2009 we were contacted by Mr and Mrs. H Moreau who, having purchased a garden apartment in Epping in November 2008. The question was if we could approximate the price could be to prolong the lease by an additional years. Comparative properties in Epping with 100 year plus lease were valued around £191,000. The average ground rent payable was £65 invoiced annually. The lease end date was on 27 May 2084. Given that there were 58 years remaining we estimated the premium to the freeholder for the lease extension to be between £23,800 and £27,400 exclusive of legals.
Mr J Khan acquired a ground floor apartment in Epping in January 1999. The question was if we could shed any light on how much (approximately) price could be to prolong the lease by an additional years. Comparable homes in Epping with an extended lease were worth £250,000. The average ground rent payable was £50 billed annually. The lease finished on 11 May 2095. Taking into account 69 years outstanding we approximated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of fees.