The value of Nailsworth leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can escalate substantially once the unexpired lease term is below than eighty years
It is generally accepted that a residential leasehold with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Chelsea 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Irrespective of whether you are a tenant or a landlord in Nailsworth,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Nailsworth valuers.
Jasper was the the leasehold proprietor of a 2 bedroom flat in Nailsworth being marketed with a lease of a few days over fifty eight years outstanding. Jasper on an informal basis spoke with his landlord being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £100 annually. Ordinarily, ground rent would not be payable on a lease extension were Jasper to exercise his statutory right. Jasper obtained expert legal guidance and was able to make an informed judgement and handle with the matter and ending up with a market value flat.
Dr E Lewis bought a one bedroom flat in Nailsworth in August 2006. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord could be for a 90 year lease extension. Comparative residencies in Nailsworth with 100 year plus lease were worth £250,400. The mid-range amount of ground rent was £65 billed yearly. The lease end date was in 2089. Taking into account 64 years remaining we estimated the compensation to the freeholder for the lease extension to be between £19,000 and £22,000 plus expenses.
Last year we were phoned by Ms Kate García , who acquired a basement flat in Nailsworth in February 2006. We are asked if we could shed any light on how much (roughly) premium would be to prolong the lease by an additional years. Comparable residencies in Nailsworth with an extended lease were worth £184,000. The mid-range ground rent payable was £55 collected per annum. The lease elapsed on 2 September 2078. Having 53 years unexpired we estimated the compensation to the landlord for the lease extension to be between £28,500 and £33,000 not including professional charges.