The market value of Kings 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
Leasehold premises in Kings Heath with in excess of 100 years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Retaining our service will provide you better control over the value of your Kings Heath leasehold, as your property will be more valuable and saleable 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.
In the wake of eight months of unsuccessful correspondence with the landlord of her one bedroom flat in Kings Heath, Madeleine initiated the lease extension process just as her lease was nearing the critical 80-year deadline. The lease extension was finalised in August 2013. The landlord’s charges were restricted to slightly above 600 GBP.
Dr Ibrahim Nguyen took over the lease of a ground floor apartment in Kings Heath in October 2012. We are asked if we could estimate the compensation to the landlord would likely be for a 90 year extension to my lease. Similar homes in Kings Heath with 100 year plus lease were valued about £285,000. The average amount of ground rent was £45 invoiced annually. The lease elapsed on 17 March 2096. Having 71 years left we calculated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 not including legals.
In 2012 we were phoned by Mr and Mrs. R Miller who, having moved into a one bedroom apartment in Kings Heath in March 2008. We are asked if we could shed any light on how much (roughly) premium would be for a ninety year extension to my lease. Similar premises in Kings Heath with 100 year plus lease were valued about £230,800. The mid-range amount of ground rent was £60 billed monthly. The lease came to a finish in 2085. Taking into account 60 years remaining we estimated the premium to the landlord for the lease extension to be within £24,700 and £28,600 plus expenses.