The only way is down when it comes to Houghton Le Spring lease terms. Houghton Le Spring properties that have a residual term fewer than 80 years will reduce in market price even faster, and the cost to extend your lease will go up.
It is conventional wisdom that a property with in excess of 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 35 years left, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with handle Houghton Le Spring 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 conveyancer we work with provide it.
Matthew owned a studio flat in Houghton Le Spring being marketed with a lease of fraction over 61 years unexpired. Matthew on an informal basis contacted his landlord a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a rise in the rent to £125 yearly. Ordinarily, ground rent would not be payable on a lease extension were Matthew to invoke his statutory right. Matthew procured expert advice and was able to make a more informed decision and handle with the matter and sell the flat.
In 2014 we were called by Mr H Smith who, having moved into a ground floor flat in Houghton Le Spring in February 1997. We are asked if we could approximate the price would likely be for a ninety year extension to my lease. Similar residencies in Houghton Le Spring with 100 year plus lease were valued around £285,000. The average ground rent payable was £55 invoiced per annum. The lease finished in 2105. Taking into account 79 years as a residual term we calculated the premium to the landlord for the lease extension to be between £13,300 and £15,400 exclusive of legals.
In 2009 we were approached by Dr S Peterson who, having was assigned a lease of a studio flat in Houghton Le Spring in May 2001. The dilemma was if we could approximate the price could be for a ninety year extension to my lease. Comparative premises in Houghton Le Spring with 100 year plus lease were in the region of £193,400. The average amount of ground rent was £65 invoiced per annum. The lease terminated in 2085. Considering the 59 years unexpired we calculated the compensation to the freeholder to extend the lease to be within £21,900 and £25,200 exclusive of costs.