Sale Lease Extension - Free Consultation

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Top reasons for Sale lease extension


Why you should start your Sale lease extension today:

A Sale lease depreciates with the years remaining on the lease.

With a domestic leasehold property in Sale, you are actually purchasing a right to live in a property for a set period of time. These days flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you should consider extending the lease sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease increases markedly particularly once there are less than 80 years left. Anyone in Sale with a lease drawing near to 81 years left should seriously consider extending it without delay. When the lease term has below 80 years outstanding, under the current statute the freeholder can calculate and levy a larger premium, assessed on a technical multiplication, strangely termed as “marriage value” which is payable.

Sale property with a lease extension is almost the same value as a freehold

It is generally accepted that a residential leasehold with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years left, the premises will be worth the same as a freehold for many years in the future.

Lenders will not finance a property with a short lease

Banks and Building Societies have specific criteria when loaning funds secured on leasehold property. Many will simply refuse lend at all once the residual lease term drops lower than a certain unexpired lease term. Many Banks and Building Societies will not regard property with a remaining below 75 years as acceptable security. In addition to this being important when selling, it is also relevant where you are wanting to refinance your Sale property.

Lender Requirement
Accord Mortgages 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.
Birmingham Midshires 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.
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.
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.

What makes us experts in Sale lease extensions?

Retaining our service gives you better control over the value of your Sale leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.

Sale Lease Extension Example Cases:

Joseph, Sale, Greater Manchester,

Joseph was the the leasehold owner of a conversion apartment in Sale being marketed with a lease of a few days over 72 years remaining. Joseph informally spoke with his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent initially set at £100 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Joseph to exercise his statutory right. Joseph procured expert advice and was able to make a more informed judgement and handle with the matter and sell the property.

Sale case:

In 2012 we were e-mailed by Dr N White who, having owned a one bedroom apartment in Sale in April 2012. The dilemma was if we could estimate the premium could be to extend the lease by 90 years. Comparable homes in Sale with a long lease were in the region of £260,000. The mid-range amount of ground rent was £50 collected yearly. The lease expired on 25 June 2096. Having 72 years outstanding we estimated the premium to the landlord to extend the lease to be within £9,500 and £11,000 plus professional charges.

Sale case:

Mr and Mrs. K Collins bought a newly refurbished apartment in Sale in November 1997. The question was if we could estimate the premium could be to prolong the lease by a further 90 years. Similar premises in Sale with 100 year plus lease were valued about £261,600. The average ground rent payable was £60 invoiced every twelve months. The lease concluded in 2076. Taking into account 52 years unexpired we approximated the premium to the freeholder for the lease extension to be within £39,000 and £45,000 plus costs.