The market value of a leasehold property in Tilehurst depends on how long the lease has left to run. If it is near to or fewer than 80 years you should foresee problems on re-sale, so it is recommended to arrange for the lease to be extended prior to buying. It is ideal to start the lease extension process when the lease still has 82 years remaining so that all matters can be finalised well before the 80 year mark. Leasehold Reform legislation enables Tilehurst qualifying lessees to obtain a new lease which will be for the balance of the existing lease plus a supplemental term of ninety years. The purpose of the valuation is to determine the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold properties in Tilehurst with over one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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; |
| 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. |
| 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. |
Lease extensions in Tilehurst can be a difficult process. We recommend you secure guidance from a conveyancer and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Tilehurst lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last year Connor, started to get close to the 80-year threshold with the lease on his one bedroom flat in Tilehurst. Having purchased his property two decades ago, the length of the lease was of no significance. Thankfully, he became aware that he needed to take action soon on Extending the lease. Connor arranged for a lease extension just in the nick of time in September. Connor and the landlord eventually settled on a premium of £6,000 . If the lease had gone below 80 years, the figure would have become more exhorbitant by a minimum £1,025.
In 2011 we were phoned by Dr Isabella Roux who, having owned a one bedroom apartment in Tilehurst in March 2004. We are asked if we could shed any light on how much (approximately) price would likely be to prolong the lease by 90 years. Similar residencies in Tilehurst with a long lease were valued around £176,200. The mid-range amount of ground rent was £65 invoiced every twelve months. The lease concluded on 7 October 2081. Having 56 years left we estimated the premium to the landlord to extend the lease to be between £29,500 and £34,000 exclusive of expenses.
Last Spring we were contacted by Mr and Mrs. I Parker , who bought a basement apartment in Tilehurst in May 2012. The question was if we could estimate the compensation to the landlord could be to prolong the lease by ninety years. Identical properties in Tilehurst with 100 year plus lease were in the region of £242,600. The average ground rent payable was £45 invoiced quarterly. The lease elapsed in 2092. Considering the 67 years remaining we estimated the premium to the freeholder for the lease extension to be between £11,400 and £13,200 not including professional charges.