The re-sale value of a leasehold property in Lechlade depends on how long the lease has remaining. If it is close to or less than 80 years you should envisage difficulties on re-sale, so it is recommended to arrange for the lease to be extended ahead of buying. Ideally one should start the lease extension process when a lease still has 82 years remaining so that all matters can be addressed ahead of the 80 year cut off point. Statute enables Lechlade qualifying lessees to acquire a new lease which will be for the balance of the existing lease plus a further term of 90 years. The reason of the valuation is to determine the sum payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a residential leasehold with in excess of 100 years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 prepared 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.
Last October Daniel, came seriously near to the eighty-year threshold with the lease on his leasehold flat in Lechlade. In buying his flat 19 years previously, the length of the lease was of little importance. by good luck, he noticed he needed to take action soon on Extending the lease. Daniel arranged for a lease extension at the eleventh hour last January. Daniel and the landlord eventually agreed on the final figure of £5,500 . If the lease had dropped lower than eighty years, the price would have escalated by a minimum £1,150.
Dr Louise Khan moved into a purpose-built apartment in Lechlade in January 2000. The question was if we could estimate the price would be for a 90 year extension to my lease. Comparative premises in Lechlade with an extended lease were worth £166,400. The average amount of ground rent was £60 billed yearly. The lease ended on 18 March 2079. Having 54 years outstanding we approximated the compensation to the freeholder to extend the lease to be within £32,300 and £37,400 not including legals.
Last month we were contacted by Mr H Edwards , who bought a ground floor flat in Lechlade in August 1997. We are asked if we could estimate the premium could be for a 90 year lease extension. Comparable flats in Lechlade with a long lease were worth £227,800. The average amount of ground rent was £45 billed per annum. The lease terminated in 2090. Given that there were 65 years unexpired we approximated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 plus expenses.