Unfortunately that a East Dean residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the East Dean property market.Once your lease nears 85ish years, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips under 80 years - otherwise a higher premium will be payable. Most flat owners in East Dean will be able to extend under the legislation; however a conveyancer will be able to confirm if you qualify for an extension. In some situations you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the formalities.
Leasehold properties in East Dean with in excess of 100 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 premises. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Coventry Building Society | 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. |
| 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. |
| Halifax | Minimum 70 years from the date 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 undertake East Dean 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 Oliver, came critically near to the eighty-year mark with the lease on his first floor apartment in East Dean. Having bought his flat two decades ago, the unexpired term was of little importance. As luck would have it, it dawned on him that he would imminently be paying way over the odds for a lease extension. Oliver extended the lease at the eleventh hour in June. Oliver and the freeholder ultimately settled on sum of £6,000 . If the lease had slid lower than eighty years, the figure would have increased by at least £1,150.
Mrs Eleanor Norbert was assigned a lease of a ground floor flat in East Dean in January 2004. The dilemma was if we could approximate the premium would likely be for a 90 year extension to my lease. Comparative properties in East Dean with a long lease were worth £233,200. The average amount of ground rent was £60 billed annually. The lease finished in 2086. Taking into account 61 years remaining we calculated the compensation to the landlord to extend the lease to be between £22,800 and £26,400 plus legals.
In 2010 we were approached by Dr K Williams who, having acquired a newly refurbished flat in East Dean in July 1996. We are asked if we could shed any light on how much (approximately) premium would likely be for a ninety year extension to my lease. Similar properties in East Dean with an extended lease were in the region of £171,800. The average amount of ground rent was £55 invoiced annually. The lease came to a finish in 2075. Considering the 50 years unexpired we estimated the compensation to the landlord for the lease extension to be between £33,300 and £38,400 plus professional charges.