Holsworthy leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. Legislation has been in place for sometime now which permits qualifying Holsworthy residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Holsworthy you would be well advised to check if your lease has between 70 and 90 years remaining. There are good reasons why a Holsworthy leaseholder with a lease having around 80 years unexpired should take action to make sure that a lease extension is effected without delay
It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to any lease with more than 35 years remaining, the property will be worth the same as a freehold for many years in the future.
| 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. |
| 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; |
| 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. |
| Godiva Mortgages | 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. |
| 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. |
Regardless of whether you are a tenant or a freeholder in Holsworthy,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 Holsworthy valuers.
Andrew was the the leasehold owner of a 2 bedroom apartment in Holsworthy being marketed with a lease of a few days over fifty eight years outstanding. Andrew informally spoke with his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £200 annually. No ground rent would be payable on a lease extension were Andrew to exercise his statutory right. Andrew procured expert advice and was able to make a more informed judgement and handle with the matter and readily saleable.
Last year we were contacted by Mr and Mrs. F Bernard , who purchased a ground floor apartment in Holsworthy in October 2004. The question was if we could approximate the compensation to the landlord could be to prolong the lease by 90 years. Comparative premises in Holsworthy with an extended lease were worth £265,000. The mid-range amount of ground rent was £50 collected quarterly. The lease end date was in 2098. Given that there were 73 years as a residual term we approximated the premium to the landlord to extend the lease to be between £9,500 and £11,000 not including expenses.
Dr Francesca Reed was assigned a lease of a one bedroom flat in Holsworthy in July 2010. The question was if we could approximate the price would likely be to extend the lease by a further 90 years. Comparative homes in Holsworthy with a long lease were in the region of £264,000. The mid-range amount of ground rent was £60 collected every twelve months. The lease lapsed on 8 September 2078. Taking into account 53 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £37,100 and £42,800 not including fees.