The market value of a leasehold property in Tiptree depends on how long the lease has left to run. If it is near to or fewer than eighty years you should envisage problems on re-sale, so it is recommended to arrange for the lease to be extended before buying. It is preferable to start the lease extension process when a lease still has 82 years remaining so that formalities can be addressed ahead of the eighty year cut off point. Statute enables Tiptree qualifying lessees to acquire a new lease which will be for the balance of the existing lease plus an additional term of 90 years. The intention of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
It is generally accepted that a residential leasehold with more than 100 years remaining is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 45 years left, the property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
Lease extensions in Tiptree can be a difficult process. We recommend you secure professional help 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 Tiptree lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Half a year ago Daniel, started to get close to the 80-year mark with the lease on his leasehold flat in Tiptree. Having bought his property twenty years ago, the unexpired term was of no interest. Thankfully, he became aware that he would soon be paying an escalated premium for Extending the lease. Daniel arranged for a lease extension just under the wire last July. Daniel and the landlord in the end settled on sum of £5,000 . If the lease had descended lower than 80 years, the amount would have increased by at least £975.
In 2010 we were contacted by Mr Joshua Gunderson who, having moved into a one bedroom apartment in Tiptree in July 2004. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord would likely be for a ninety year lease extension. Identical premises in Tiptree with 100 year plus lease were valued around £250,000. The mid-range amount of ground rent was £50 collected monthly. The lease ran out on 7 June 2094. Given that there were 68 years left we calculated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 plus costs.
In 2010 we were e-mailed by Dr H Moreau who, having moved into a one bedroom apartment in Tiptree in March 2007. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would likely be to prolong the lease by 90 years. Similar flats in Tiptree with 100 year plus lease were in the region of £285,000. The mid-range amount of ground rent was £55 billed yearly. The lease elapsed on 15 March 2105. Given that there were 79 years remaining we approximated the premium to the freeholder to extend the lease to be between £13,300 and £15,400 plus professional charges.