The market value of Histon 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 increase significantly once the remaining term is less than eighty years
Leasehold residencies in Histon with more than 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| 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. |
| 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 |
Regardless of whether you are a tenant or a landlord in Histon,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Histon valuers.
Last October Joshua, came perilously near to the 80-year mark with the lease on his first floor apartment in Histon. In buying his flat two decades ago, the unexpired term was of little interest. As luck would have it, it dawned on him that he needed to take action soon on Extending the lease. Joshua was able to extend his lease at the eleventh hour in June. Joshua and the landlord who owned the flat above eventually agreed on an amount of £6,000 . If he had missed the deadline, the price would have gone up by at least £850.
Last August we were contacted by Mrs P Bertrand , who owned a ground floor apartment in Histon in November 1998. The question was if we could approximate the price would likely be for a ninety year extension to my lease. Comparable properties in Histon with 100 year plus lease were worth £270,000. The average amount of ground rent was £55 billed quarterly. The lease terminated in 2101. Taking into account 76 years unexpired we calculated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 exclusive of fees.
Mr and Mrs. M Reed took over the lease of a ground floor flat in Histon in November 2000. We are asked if we could approximate the price would be to prolong the lease by ninety years. Identical homes in Histon with a long lease were valued around £176,200. The average ground rent payable was £65 collected annually. The lease end date was in 2081. Given that there were 56 years remaining we approximated the premium to the landlord for the lease extension to be within £29,500 and £34,000 not including expenses.