The re-sale value of a leasehold property in Lowestoft is impacted by how long the lease has remaining. If it is near to or less than eighty years you should foresee difficulties on re-sale, so it is advisable to arrange for the lease to be extended before buying. It is preferable to commence the lease extension process when the lease still has 82 years to run so that formalities can be addressed prior to the eighty year cut off point. Statute entitles Lowestoft qualifying lessees to an additional term of ninety years in addition to the unexpired term, at a notional rent (no ground rent). The intention of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold residencies in Lowestoft with over one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
Regardless of whether you are a tenant or a freeholder in Lowestoft,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Lowestoft valuers.
Evan owned a high value flat in Lowestoft on the market with a lease of fraction over sixty years outstanding. Evan on an informal basis spoke with his landlord being a well known Manchester-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension 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 Evan to invoke his statutory right. Evan procured expert advice and was able to make a more informed decision and handle with the matter and ending up with a market value flat.
In 2014 we were approached by Dr C Turner who, having owned a purpose-built flat in Lowestoft in September 2006. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would be to extend the lease by 90 years. Comparative residencies in Lowestoft with a long lease were worth £233,200. The mid-range ground rent payable was £60 collected monthly. The lease expired on 4 February 2086. Having 61 years as a residual term we approximated the premium to the freeholder for the lease extension to be within £22,800 and £26,400 not including fees.
Mr and Mrs. E Walker moved into a basement apartment in Lowestoft in March 2008. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord could be to prolong the lease by 90 years. Similar residencies in Lowestoft with an extended lease were in the region of £166,800. The mid-range amount of ground rent was £50 collected per annum. The lease elapsed in 2075. Taking into account 50 years remaining we calculated the premium to the freeholder to extend the lease to be between £32,300 and £37,400 not including expenses.