Sea Mills leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. It is the case that most Sea Mills tenants have the right to extend their lease by an additional ninety years in accordance with the 1993 Leasehold Reform Act. If you are a leasehold owner in Sea Mills you must investigate if your lease has between seventy and ninety years remaining. In particular once the remaining lease term slips under 80 years, the cost of any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
Leasehold residencies in Sea Mills with in excess of one hundred years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 handle Sea Mills 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.
18 months ago Henry, came dangerously close to the 80-year threshold with the lease on his studio flat in Sea Mills. Having bought his home twenty years ago, the lease term was of little concern. Thankfully, he became aware that he would imminently be paying an escalated premium for a lease extension. Henry arranged for a lease extension at the eleventh hour in May. Henry and the freeholder via the management company eventually agreed on sum of £6,000 . If he had missed the deadline, the amount would have increased by a minimum £925.
In 2010 we were phoned by Mrs Abbie Gómez who, having took over the lease of a basement apartment in Sea Mills in May 2006. We are asked if we could estimate the compensation to the landlord would be to prolong the lease by 90 years. Comparative properties in Sea Mills with 100 year plus lease were valued about £205,000. The average ground rent payable was £50 invoiced every twelve months. The lease came to a finish in 2104. Given that there were 79 years unexpired we approximated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 plus legals.
Mr and Mrs. E Alexander moved into a newly refurbished apartment in Sea Mills in June 2009. We are asked if we could approximate the premium would be for a ninety year lease extension. Similar properties in Sea Mills with 100 year plus lease were valued around £275,000. The mid-range ground rent payable was £65 collected monthly. The lease concluded on 18 April 2093. Given that there were 68 years remaining we estimated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 plus legals.