The market value of a leasehold property in Sandbanks depends on how many years the lease has left to run. If it is near to or less than 80 years you should expect difficulties on re-sale, so it is recommended to arrange for the lease to be extended prior to purchasing. It is preferable to start the lease extension process when a lease still has 82 years unexpired so that formalities can be finalised well before the eighty year cut off point. Leasehold Reform legislation enables Sandbanks qualifying lessees to an additional term of ninety years over and above the existing term, at a peppercorn rent (zero ground rent). The purpose of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a residential leasehold with in excess of 100 years remaining is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with procure Sandbanks 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 conveyancing solicitor we work with provide it.
Following lengthy discussions with the landlord of her first floor apartment in Sandbanks, Chantelle started the lease extension process just as her lease was nearing the crucial eighty-year mark. The transaction was concluded in September 2013. The landlord’s charges were restricted to approximately 500 pounds.
Last year we were contacted by Mr Kyle Reed , who took over the lease of a studio flat in Sandbanks in January 1996. We are asked if we could estimate the compensation to the landlord would be to extend the lease by ninety years. Comparative residencies in Sandbanks with 100 year plus lease were in the region of £193,400. The average ground rent payable was £65 collected quarterly. The lease came to a finish on 25 April 2084. Having 59 years outstanding we approximated the premium to the freeholder to extend the lease to be between £21,900 and £25,200 plus legals.
Ms C Davis moved into a garden flat in Sandbanks in October 1998. The dilemma was if we could estimate the compensation to the landlord could be to prolong the lease by 90 years. Similar flats in Sandbanks with an extended lease were in the region of £250,000. The mid-range amount of ground rent was £50 invoiced quarterly. The lease came to a finish on 8 April 2095. Considering the 70 years left we approximated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 exclusive of fees.