The market value of Peterlee leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can escalate substantially once the unexpired lease term is below than 80 years
Leasehold residencies in Peterlee with in excess of one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | 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. |
Irrespective of whether you are a tenant or a freeholder in Peterlee,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 experience and the close ties they enjoy with Peterlee valuers.
Elijah owned a high value flat in Peterlee on the market with a lease of a few days over fifty eight years remaining. Elijah on an informal basis approached his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £150 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Elijah to exercise his statutory right. Elijah procured expert legal guidance and was able to make an informed decision and deal with the matter and ending up with a market value flat.
In 2012 we were e-mailed by Mr and Mrs. M Kelly who, having purchased a garden apartment in Peterlee in October 2002. We are asked if we could estimate the price would likely be for a ninety year extension to my lease. Identical flats in Peterlee with an extended lease were valued around £176,200. The mid-range amount of ground rent was £65 billed per annum. The lease finished in 2081. Taking into account 56 years left we approximated the compensation to the landlord for the lease extension to be between £29,500 and £34,000 exclusive of fees.
Last Winter we were called by Ms E Cooper , who owned a first floor apartment in Peterlee in September 2011. The question was if we could approximate the compensation to the landlord could be for a 90 year lease extension. Comparable residencies in Peterlee with an extended lease were valued around £242,600. The average amount of ground rent was £45 collected monthly. The lease termination date was on 16 July 2092. Given that there were 67 years remaining we calculated the compensation to the freeholder to extend the lease to be between £11,400 and £13,200 exclusive of professional charges.