Lechlade residential property held on a long lease is a depreciating asset as the leaseholder merely owns the property for a period of years.
It is conventional wisdom that a residential leasehold with more than one hundred years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before 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. |
Irrespective of whether you are a tenant or a landlord in Lechlade,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 in-depth market knowledge and the close ties they enjoy with Lechlade valuers.
In recent months Logan, came precariously close to the 80-year mark with the lease on his two bedroom flat in Lechlade. Having bought his flat two decades ago, the unexpired term was of minimal importance. Fortunately, it dawned on him that he would imminently be paying an inflated amount for a lease extension. Logan was able to extend his lease at the eleventh hour last January. Logan and the landlord eventually agreed on an amount of £5,500 . If the lease had slipped to less than eighty years, the premium would have become more exhorbitant by at least £1,050.
In 2011 we were e-mailed by Mrs U Adams who, having moved into a ground floor apartment in Lechlade in October 2011. The dilemma was if we could estimate the premium would be for a ninety year extension to my lease. Comparable flats in Lechlade with 100 year plus lease were in the region of £246,800. The mid-range ground rent payable was £60 collected every twelve months. The lease expiry date was on 16 August 2075. Given that there were 50 years left we estimated the compensation to the freeholder for the lease extension to be between £44,700 and £51,600 plus fees.
In 2009 we were approached by Mrs Lily Kelly who, having moved into a garden apartment in Lechlade in May 2010. The question was if we could shed any light on how much (roughly) compensation to the landlord would be to prolong the lease by a further 90 years. Similar flats in Lechlade with a long lease were worth £208,200. The mid-range amount of ground rent was £65 invoiced annually. The lease came to a finish on 10 November 2086. Considering the 61 years outstanding we calculated the compensation to the freeholder for the lease extension to be between £20,000 and £23,000 exclusive of costs.