The market value of a leasehold property in Hassocks is impacted by how long the lease has left to run. If it is near to or less than eighty years you should expect difficulties on re-sale, so it is advisable to arrange for a lease extension prior to purchasing. It is ideal to start the lease extension process when a lease still has 82 years to run so that formalities can be finalised well before the 80 year threshold. Statute entitles Hassocks qualifying lessees to acquire a new lease which will be for the current unexpired lease term plus an additional term of 90 years. The purpose of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold residencies in Hassocks with more than 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 premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges merit 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. |
| 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; |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with handle Hassocks 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.
After protracted correspondence with the landlord of her leasehold apartment in Hassocks, Chantelle commenced the lease extension process just as the lease was nearing the crucial eighty-year mark. The transaction was finalised in September 2008. The landlord’s charges were kept to an absolute minimum.
Last Christmas we were phoned by Mr P White , who completed a one bedroom flat in Hassocks in January 2012. We are asked if we could estimate the price would be to prolong the lease by an additional years. Comparable residencies in Hassocks with an extended lease were in the region of £203,200. The mid-range amount of ground rent was £65 collected every twelve months. The lease finished in 2086. Considering the 61 years outstanding we estimated the compensation to the landlord for the lease extension to be between £19,000 and £22,000 exclusive of professional charges.
In 2014 we were approached by Ms O Carter who, having acquired a purpose-built flat in Hassocks in November 2007. We are asked if we could approximate the price could be to extend the lease by a further 90 years. Comparable flats in Hassocks with an extended lease were valued about £260,000. The mid-range amount of ground rent was £50 billed monthly. The lease lapsed on 9 March 2097. Taking into account 72 years outstanding we estimated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 plus professional charges.