Unfortunately that a Long Sutton residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the depreciation being disguised by increases in the Long Sutton property market.Where your lease has approximately 90 years left, you need to 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 slips below eighty years - otherwise a higher amount will be due. Most flat owners in Long Sutton will be able to extend under the legislation; however a lawyer will be able to confirm if you are eligibility. In some situations you may not be entitled. There are also strict timetables and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancer from beginning to end of the formalities.
Leasehold properties in Long Sutton with more than one hundred years unexpired on the lease are often referred to as ‘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 estate charges warrant 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
Regardless of whether you are a tenant or a freeholder in Long Sutton,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Long Sutton valuers.
Following unsuccessful correspondence with the freeholder of her garden flat in Long Sutton, Eleanor initiated the lease extension process just as the lease was approaching the critical 80-year mark. The transaction was concluded in April 2011. The landlord’s costs were restricted to slightly above 450 pounds.
In 2012 we were called by Mr and Mrs. N Lewis who, having moved into a purpose-built apartment in Long Sutton in January 2003. We are asked if we could estimate the premium could be for a 90 year lease extension. Identical homes in Long Sutton with an extended lease were worth £198,800. The mid-range ground rent payable was £55 collected annually. The lease expiry date was on 26 June 2080. Having 55 years left we approximated the compensation to the freeholder for the lease extension to be between £33,300 and £38,400 not including fees.
Dr F Richardson completed a ground floor flat in Long Sutton in September 2005. We are asked if we could shed any light on how much (roughly) premium would likely be to prolong the lease by 90 years. Comparative homes in Long Sutton with a long lease were worth £300,000. The mid-range ground rent payable was £50 billed every twelve months. The lease ran out on 17 October 2100. Considering the 75 years left we approximated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 not including costs.