The value of Newbury 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 increase materialy once the unexpired lease term is below than 80 years
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the property 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. |
| Godiva Mortgages | 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Engaging our service gives you enhanced control over the value of your Newbury leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
After unsuccessful discussions with the landlord of her two bedroom flat in Newbury, Maisie initiated the lease extension process just as the lease was nearing the critical eighty-year threshold. The legal work was concluded in September 2008. The freeholder’s costs were negotiated to slightly above five hundred GBP.
In 2009 we were approached by Mr and Mrs. N Howard who, having acquired a one bedroom apartment in Newbury in July 2006. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be for a ninety year extension to my lease. Similar properties in Newbury with 100 year plus lease were in the region of £257,800. The mid-range ground rent payable was £65 billed quarterly. The lease finished on 20 July 2089. Taking into account 65 years as a residual term we calculated the premium to the landlord for the lease extension to be within £18,100 and £20,800 plus expenses.
Last Summer we were approach by Mr Alfie Turner , who was assigned a lease of a first floor apartment in Newbury in April 2000. The dilemma was if we could approximate the compensation to the landlord could be to extend the lease by 90 years. Similar properties in Newbury with 100 year plus lease were in the region of £191,400. The average ground rent payable was £55 invoiced monthly. The lease lapsed on 27 May 2078. Considering the 54 years outstanding we calculated the compensation to the landlord to extend the lease to be within £34,200 and £39,600 not including costs.