The value of Cleethorpes leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can escalate materialy once the unexpired lease term is less than eighty years
Leasehold premises in Cleethorpes with in excess of one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| 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. |
Irrespective of whether you are a tenant or a landlord in Cleethorpes,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 experience and the close ties they enjoy with Cleethorpes valuers.
Ollie owned a conversion apartment in Cleethorpes being marketed with a lease of just over 61 years outstanding. Ollie informally spoke with his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of a rise in the rent to £100 per annum. No ground rent would be due on a lease extension were Ollie to exercise his statutory right. Ollie procured expert legal guidance and was able to make a more informed judgement and deal with the matter and readily saleable.
Last Autumn we were contacted by Mr and Mrs. P Gray , who moved into a newly refurbished flat in Cleethorpes in August 2007. We are asked if we could estimate the compensation to the landlord would likely be for a ninety year lease extension. Identical residencies in Cleethorpes with a long lease were worth £210,600. The average ground rent payable was £45 invoiced annually. The lease came to a finish in 2087. Having 62 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £18,100 and £20,800 exclusive of legals.
Mr Gabriel Adams acquired a first floor apartment in Cleethorpes in April 2006. We are asked if we could approximate the price could be to extend the lease by 90 years. Comparative premises in Cleethorpes with a long lease were valued about £265,000. The mid-range ground rent payable was £50 invoiced monthly. The lease terminated in 2098. Considering the 73 years left we approximated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 exclusive of costs.