This is a tool that calculates the values relevant to the purchasing of the freehold of a property. These values are the present value of the freehold, the present value of the ground rent, the present reversion value and the marriage value.

Note: This is a UK specific tool as the calculations are based on the valuation formulas used by the UK Lands Tribunal.

For the calculation of freehold purchase values, it is necessary to supply the following information:

• The value of the leasehold.
• The number of years remaining on the lease.
• The annual ground rent.
• The present relative value of the leasehold in relation to the freehold. This is usually expressed in percentage terms (unless the formatting is explicitly set to express it as a decimal).
• The reversion rate, which is the discount rate used to determine the present value of the future worth of the property at the point when the lease expires and it reverts to the freeholder. This is usually expressed in percentage terms (unless the formatting is explicitly set to express it as a decimal).
• The yield rate, which is the rate used to discount the future ground rent owed to the freeholder in order to calculate the present ground rent value. This is usually expressed in percentage terms (unless the formatting is explicitly set to express it as a decimal).

Associated tool link: http://www.coggit.com/tools/uk_leasehold_freehold_costs.html