Nailsworth residential property owned on a long lease is a depreciating asset as the leaseholder merely owns the property for a set term.
It is generally accepted that a property with over 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | 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. |
| 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. |
The conveyancing solicitors that we work with undertake Nailsworth lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Following unsuccessful discussions with the freeholder of her basement apartment in Nailsworth, Maisie commenced the lease extension process just as the lease was nearing the critical 80-year threshold. The lease extension was concluded in October 2012. The landlord’s costs were kept to an absolute minimum.
In 2009 we were e-mailed by Dr Omar Pérez who, having took over the lease of a recently refurbished apartment in Nailsworth in October 2007. We are asked if we could shed any light on how much (approximately) premium could be for a 90 year extension to my lease. Comparative homes in Nailsworth with a long lease were in the region of £216,000. The average amount of ground rent was £60 collected monthly. The lease concluded on 9 February 2083. Given that there were 58 years outstanding we approximated the compensation to the landlord to extend the lease to be between £28,500 and £33,000 plus legals.
Dr Francesca Moore was assigned a lease of a studio flat in Nailsworth in August 2008. The dilemma was if we could shed any light on how much (roughly) premium would likely be for a 90 year lease extension. Identical flats in Nailsworth with a long lease were in the region of £200,000. The average amount of ground rent was £50 invoiced yearly. The lease termination date was on 17 November 2103. Given that there were 78 years left we calculated the premium to the landlord for the lease extension to be between £8,600 and £9,800 plus fees.