The market value of Epping leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can escalate materialy once the unexpired lease term is less than eighty years
It is generally considered that a property with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 30 years left, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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. |
| Halifax | Minimum 70 years from the date 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. |
| Yorkshire 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. |
Lease extensions in Epping can be a difficult process. We recommend you secure professional help from a conveyancing solicitor and valuer with experience in lease extensions.
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 a wealth of experience dealing with Epping lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last October Jason, started to get near to the 80-year threshold with the lease on his two bedroom flat in Epping. Having purchased his flat two decades ago, the lease term was of little concern. Luckily, he noticed he needed to take action soon on a lease extension. Jason extended the lease just ahead of time last August. Jason and the landlord eventually settled on an amount of £6,000 . If the lease had dipped below 80 years, the figure would have escalated by a minimum £950.
In 2012 we were approached by Mr and Mrs. A Lee who, having purchased a one bedroom flat in Epping in February 2005. The dilemma was if we could estimate the price could be for a ninety year lease extension. Similar flats in Epping with an extended lease were worth £246,800. The mid-range amount of ground rent was £60 invoiced quarterly. The lease came to a finish on 15 February 2076. Taking into account 50 years left we calculated the premium to the freeholder for the lease extension to be between £44,700 and £51,600 plus legals.
Mr and Mrs. I Cook owned a one bedroom apartment in Epping in February 2006. The dilemma was if we could estimate the price would likely be to prolong the lease by a further 90 years. Similar residencies in Epping with an extended lease were valued around £208,200. The mid-range amount of ground rent was £65 invoiced yearly. The lease termination date was in 2087. Taking into account 61 years outstanding we approximated the compensation to the freeholder to extend the lease to be within £20,000 and £23,000 exclusive of legals.