Farnham Royal leases on domestic properties are gradually losing value. Where your lease has about 90 years left, you should start thinking about a lease extension. Eighty years is a significant number: when the remaining term of a lease drops below this level then you start paying an additional element called marriage value. Leasehold owners in Farnham Royal will usually be legally entitled to a lease extension; however a solicitor will check if you qualify. In certain cases you may not qualify. There are also strict timetables and procedures to comply with once the process is triggered so it’s best to be guided by a conveyancer during the process.
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be equivalent in value to 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. |
| Bank of Scotland | 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. |
| 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 |
| 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. |
The lawyers that we work with procure Farnham Royal 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 lawyer we work with provide it.
In the wake of eight months of lengthy discussions with the freeholder of her garden apartment in Farnham Royal, Hannah started the lease extension process as the 80 year deadline was swiftly nearing. The legal work was concluded in October 2014. The landlord’s charges were restricted to under 650 pounds.
In 2011 we were called by Ms Ashleigh Lewis who, having completed a recently refurbished apartment in Farnham Royal in October 1997. We are asked if we could approximate the premium could be to prolong the lease by 90 years. Identical homes in Farnham Royal with 100 year plus lease were worth £275,000. The average amount of ground rent was £55 invoiced quarterly. The lease concluded in 2102. Taking into account 77 years remaining we estimated the compensation to the freeholder to extend the lease to be within £13,300 and £15,400 plus professional charges.
Dr Holly Bertrand moved into a first floor apartment in Farnham Royal in February 2004. The question was if we could estimate the compensation to the landlord could be for a ninety year extension to my lease. Identical properties in Farnham Royal with an extended lease were in the region of £183,600. The average ground rent payable was £65 billed every twelve months. The lease ended on 18 April 2082. Given that there were 57 years left we approximated the premium to the freeholder to extend the lease to be within £28,500 and £33,000 exclusive of expenses.