The re-sale value of a leasehold property in Crowborough is impacted by how many years the lease has remaining. If it is near to or less than 80 years you should anticipate problems on re-sale, so it is advisable to arrange for a lease extension before purchasing. It is preferable to commence the lease extension process when a lease still has 82 years remaining so that formalities can be concluded well before the 80 year cut off point. Statute entitles Crowborough qualifying lessees to an additional term of 90 years in addition to the existing term, at a peppercorn rent (zero ground rent). The reason 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 Crowborough with over one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Yorkshire 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. |
The lawyers that we work with undertake Crowborough lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Two years ago Harvey, came seriously near to the eighty-year mark with the lease on his one bedroom apartment in Crowborough. In buying his home 19 years ago, the lease term was of minimal interest. Thankfully, he realised he needed to take steps soon on a lease extension. Harvey arranged for a lease extension just ahead of time in August. Harvey and the freeholder via the managing agents in the end settled on an amount of £6,000 . If the lease had slid below eighty years, the amount would have gone up by a minimum £975.
In 2010 we were approached by Dr Henry Phillips who, having bought a purpose-built apartment in Crowborough in June 1997. The question was if we could estimate the premium would likely be to prolong the lease by 90 years. Comparable properties in Crowborough with a long lease were in the region of £275,000. The mid-range ground rent payable was £55 invoiced per annum. The lease expiry date was on 19 August 2102. Taking into account 77 years as a residual term we calculated the premium to the freeholder to extend the lease to be between £13,300 and £15,400 exclusive of costs.
Mr Jayden Scott purchased a one bedroom apartment in Crowborough in October 1995. We are asked if we could estimate the premium could be for a 90 year extension to my lease. Comparative properties in Crowborough with an extended lease were in the region of £183,600. The mid-range amount of ground rent was £65 collected every twelve months. The lease elapsed in 2082. Having 57 years as a residual term we estimated the compensation to the landlord to extend the lease to be between £28,500 and £33,000 not including fees.