Unfortunately that a Hornsea residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the loss of value being disguised by increases in the Hornsea property prices.Where your lease has approximately ninety years left, you should start thinking about 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 falls under eighty years - otherwise a higher amount will be payable. Most leasehold owners in Hornsea will be able to extend under the legislation; however a conveyancer should be able to clarify if you are eligibility. In some cases you may not be entitled. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your conveyancer throughout the formalities.
Leasehold properties in Hornsea with in excess of 100 years remaining 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 situations there is often little to be gained by purchasing the reversionary interest 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a freeholder in Hornsea,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Hornsea valuers.
Ibrahim owned a 2 bedroom flat in Hornsea on the market with a lease of just over fifty eight years outstanding. Ibrahim on an informal basis approached his landlord being a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to a rise in the rent to £50 annually. Ordinarily, ground rent would not be payable on a lease extension were Ibrahim to invoke his statutory right. Ibrahim obtained expert legal guidance and secured satisfactory deal informally and readily saleable.
In 2012 we were e-mailed by Dr Isabel Morel who, having bought a first floor flat in Hornsea in August 2007. We are asked if we could estimate the premium could be for a 90 year lease extension. Identical flats in Hornsea with an extended lease were valued around £285,000. The average amount of ground rent was £55 invoiced every twelve months. The lease elapsed in 2105. Given that there were 79 years as a residual term we calculated the premium to the freeholder for the lease extension to be between £13,300 and £15,400 exclusive of expenses.
Dr Noah Turner was assigned a lease of a purpose-built apartment in Hornsea in July 1995. We are asked if we could approximate the compensation to the landlord could be to extend the lease by ninety years. Identical premises in Hornsea with 100 year plus lease were worth £198,400. The mid-range amount of ground rent was £65 invoiced annually. The lease end date was in 2085. Given that there were 59 years outstanding we approximated the premium to the freeholder to extend the lease to be between £21,900 and £25,200 plus fees.