It’s an underpublicised certainty that a Hornsea residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the reduction being disguised by increases in the Hornsea property market.Once your lease nears 85ish years, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips lower than 80 years - otherwise a higher amount will be payable. Most leasehold owners in Hornsea will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm whether you qualify for an extension. In some situations you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer throughout the process.
It is generally accepted that a property with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 35 years left, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a landlord in Hornsea,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Hornsea valuers.
Nathan was the the leasehold proprietor of a high value apartment in Hornsea on the market with a lease of just over sixty years unexpired. Nathan informally spoke with his landlord a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £200 per annum. No ground rent would be payable on a lease extension were Nathan to invoke his statutory right. Nathan obtained expert legal guidance and secured satisfactory deal informally and ending up with a market value flat.
Last Summer we were called by Mr Oscar Rivera , who took over the lease of a basement apartment in Hornsea in October 1997. We are asked if we could shed any light on how much (roughly) price could be to extend the lease by 90 years. Comparable properties in Hornsea with an extended lease were valued around £285,000. The mid-range amount of ground rent was £55 invoiced per annum. The lease concluded on 21 January 2104. Considering the 79 years unexpired we estimated the premium to the landlord for the lease extension to be within £13,300 and £15,400 exclusive of legals.
In 2011 we were e-mailed by Mr and Mrs. J Wood who, having purchased a first floor flat in Hornsea in October 2010. The dilemma was if we could estimate the premium would be to extend the lease by an additional years. Comparable flats in Hornsea with an extended lease were valued around £193,400. The mid-range ground rent payable was £65 invoiced monthly. The lease ended on 15 January 2084. Given that there were 59 years remaining we calculated the compensation to the freeholder for the lease extension to be between £21,900 and £25,200 plus expenses.