The market value of Flackwell Heath leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can escalate substantially once the unexpired lease term is below than eighty years
It is generally considered that a residential leasehold with over one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 45 years unexpired, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| 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 |
Retaining our service gives you better control over the value of your Flackwell Heath leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Harvey was the the leasehold owner of a 2 bedroom apartment in Flackwell Heath on the market with a lease of a little over 59 years outstanding. Harvey on an informal basis approached his freeholder a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £100 annually. Ordinarily, ground rent would not be due on a lease extension were Harvey to invoke his statutory right. Harvey procured expert advice and was able to make an informed decision and deal with the matter and readily saleable.
Mrs Madeleine Mitchell completed a newly refurbished apartment in Flackwell Heath in May 1998. The question was if we could estimate the compensation to the landlord would likely be to prolong the lease by a further 90 years. Comparable properties in Flackwell Heath with an extended lease were in the region of £200,000. The mid-range ground rent payable was £50 invoiced yearly. The lease expired in 2103. Having 77 years as a residual term we calculated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 not including expenses.
Last Christmas we were contacted by Mr L Laurent , who bought a ground floor apartment in Flackwell Heath in May 2011. We are asked if we could approximate the premium would be for a ninety year lease extension. Identical flats in Flackwell Heath with 100 year plus lease were worth £265,200. The mid-range ground rent payable was £65 collected every twelve months. The lease lapsed in 2092. Having 66 years unexpired we calculated the compensation to the freeholder to extend the lease to be within £15,200 and £17,600 exclusive of professional charges.