Fairford residential property held on a long lease is a wasting asset because a leaseholder merely owns the property for a set term.
Leasehold properties in Fairford with over 100 years left on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Engaging our service will provide you better control over the value of your Fairford leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In 2014 Finn, came seriously close to the eighty-year mark with the lease on his first floor apartment in Fairford. Having purchased his home two decades ago, the length of the lease was of minimal relevance. Luckily, he realised he would soon be paying way over the odds for Extending the lease. Finn extended the lease just in the nick of time in January. Finn and the freeholder via the management company eventually settled on an amount of £6,000 . If the lease had fallen below 80 years, the sum would have escalated by at least £1,025.
Last Autumn we were contacted by Dr Blake Girard , who purchased a recently refurbished flat in Fairford in July 2008. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be to extend the lease by ninety years. Identical flats in Fairford with 100 year plus lease were valued around £196,400. The average ground rent payable was £55 billed annually. The lease expired in 2080. Taking into account 54 years left we estimated the premium to the landlord for the lease extension to be between £35,200 and £40,600 exclusive of costs.
Last month we were phoned by Ms M Lambert , who purchased a one bedroom apartment in Fairford in November 2002. The dilemma was if we could estimate the premium would likely be for a ninety year lease extension. Identical premises in Fairford with 100 year plus lease were in the region of £295,000. The average amount of ground rent was £45 billed every twelve months. The lease finished on 28 July 2100. Considering the 74 years outstanding we approximated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 exclusive of costs.