With a long leasehold property in Kemp Town, you are actually purchasing an entitlement to reside in a property for a prescribed time frame. Modern flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you should think about extending the lease sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease gets disproportionately more expensive particularly once there are fewer than 80 years left. Leasehold owners in Kemp Town with a lease drawing near to 81 years remaining should seriously think of extending it without delay. Once the lease term has below eighty years left, under the relevant statute the freeholder is entitled to calculate and charge a greater premium, based on a technical calculation, known as “marriage value” which is due.
Leasehold premises in Kemp Town with more than 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 situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service will provide you enhanced control over the value of your Kemp Town leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Harry, came perilously near to the 80-year threshold with the lease on his two bedroom flat in Kemp Town. Having bought his flat 19 years previously, the length of the lease was of minimal importance. Thankfully, he became aware that he would soon be paying an escalated premium for Extending the lease. Harry was able to extend his lease just under the wire in August. Harry and the landlord ultimately agreed on sum of £6,000 . If the lease had fallen below 80 years, the premium would have escalated by a minimum £1,025.
In 2009 we were approached by Mr and Mrs. A Cox who, having owned a garden flat in Kemp Town in April 1997. We are asked if we could estimate the premium could be to extend the lease by an additional years. Comparable premises in Kemp Town with an extended lease were worth £267,600. The average amount of ground rent was £65 invoiced per annum. The lease lapsed in 2093. Having 67 years remaining we approximated the compensation to the landlord for the lease extension to be within £14,300 and £16,400 plus costs.
In 2013 we were approached by Dr K Jackson who, having completed a ground floor apartment in Kemp Town in October 2010. The dilemma was if we could shed any light on how much (approximately) price would likely be to extend the lease by an additional years. Similar premises in Kemp Town with an extended lease were in the region of £206,200. The mid-range amount of ground rent was £55 billed every twelve months. The lease end date was in 2082. Considering the 56 years as a residual term we calculated the compensation to the freeholder for the lease extension to be between £31,400 and £36,200 not including costs.