Rednal residential property owned on a long lease is a wasting asset as the leaseholder merely owns the property for a period of years.
It is generally considered that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 35 years left, the premises will be worth the same as a freehold for decades to come.
| 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. |
| Birmingham Midshires | 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a freeholder in Rednal,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Rednal valuers.
After protracted correspondence with the freeholder of her basement apartment in Rednal, Shannon initiated the lease extension process as the eighty year deadline was swiftly approaching. The lease extension completed in September 2014. The landlord’s fees were negotiated to less than 550 pounds.
Dr B Brown acquired a first floor flat in Rednal in February 1997. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be for a ninety year lease extension. Identical homes in Rednal with a long lease were worth £206,200. The average ground rent payable was £60 collected every twelve months. The lease terminated in 2080. Having 56 years remaining we approximated the compensation to the landlord for the lease extension to be between £31,400 and £36,200 plus expenses.
In 2009 we were contacted by Dr I Fournier who, having completed a one bedroom apartment in Rednal in April 2010. We are asked if we could estimate the compensation to the landlord could be for a ninety year lease extension. Identical premises in Rednal with a long lease were valued around £300,000. The mid-range amount of ground rent was £50 invoiced per annum. The lease elapsed on 20 October 2100. Considering the 76 years unexpired we approximated the compensation to the landlord to extend the lease to be within £8,600 and £9,800 plus fees.