The value of Brighton leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can increase significantly once the remaining term is less than 80 years
Leasehold residencies in Brighton with in excess of 100 years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges justify it.
| 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. |
| 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. |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Royal Bank of Scotland | 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. |
Regardless of whether you are a tenant or a freeholder in Brighton,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Brighton valuers.
Rory owned a high value flat in Brighton on the market with a lease of a little over 61 years outstanding. Rory informally approached his landlord a well known Manchester-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a rise in the rent to £200 annually. Ordinarily, ground rent would not be payable on a lease extension were Rory to invoke his statutory right. Rory obtained expert advice and secured satisfactory deal without going to tribunal and readily saleable.
Last Christmas we were approach by Mr J Nguyen , who purchased a first floor apartment in Brighton in June 2000. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would likely be to extend the lease by ninety years. Comparable premises in Brighton with an extended lease were worth £290,000. The mid-range ground rent payable was £60 invoiced per annum. The lease concluded in 2105. Given that there were 80 years outstanding we estimated the premium to the landlord for the lease extension to be within £13,300 and £15,400 exclusive of costs.
Last Winter we were called by Dr Theo Wilson , who owned a studio flat in Brighton in February 2003. The question was if we could estimate the compensation to the landlord would likely be to extend the lease by a further 90 years. Comparative flats in Brighton with an extended lease were in the region of £200,800. The average amount of ground rent was £65 collected quarterly. The lease came to a finish on 15 September 2085. Given that there were 60 years unexpired we calculated the compensation to the landlord to extend the lease to be within £20,900 and £24,200 plus expenses.