Sipson leases on residential deteriorating in value. Where your lease has about ninety years remaining, you should start thinking about a lease extension. It is important to recognise that it is that it is financially advisable for your lease extension to be in place before the term of the existing lease drops lower than eighty years - otherwise a higher amount will be payable. Flat owners in Sipson will mostly qualify for a lease extension; however a solicitor will check if you qualify. In certain cases you may not qualify. There are prescribed timetables and procedures to follow once the process has commenced so it’s wise to be guided by a lawyer during the process.
It is conventional wisdom that a residential leasehold with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be worth the same as 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with undertake Sipson 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 lawyer we work with provide it.
In the wake of 9 months of unsuccessful discussions with the landlord of her two bedroom flat in Sipson, Sian started the lease extension process just as the lease was nearing the crucial 80-year deadline. The lease extension was concluded in June 2006. The freeholder’s costs were negotiated to approximately 700 pounds.
Last month we were called by Dr K Parker , who purchased a recently refurbished flat in Sipson in April 2004. The question was if we could estimate the compensation to the landlord would be to prolong the lease by a further 90 years. Comparative flats in Sipson with an extended lease were in the region of £193,400. The average amount of ground rent was £65 invoiced yearly. The lease ended in 2084. Taking into account 59 years left we approximated the premium to the landlord for the lease extension to be between £21,900 and £25,200 exclusive of expenses.
An example of a Freehold Enfranchisement decision for a Sipson premises is 164 Nestles Avenue in October 2013. The tribunal agreed with the proposed price of £20,158 for the freehold and determined that that sum is the amount to be paid into court This case related to 2 flats. The remaining number of years on the lease was 69 years.