When it comes to residential leasehold property in Rustington, you are in fact renting it for a certain amount of time. Modern flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you may think about a lease extension sooner rather than later. The general rule is that the shorter the number of years is the cost of extending the lease increases markedly particularly when there are fewer than eighty years remaining. Leasehold owners in Rustington with a lease nearing 81 years remaining should seriously consider extending it without delay. When a lease has below eighty years left, under the relevant legislation the freeholder can calculate and charge a greater premium, based on a technical multiplication, strangely termed as “marriage value” which is due.
Leasehold properties in Rustington 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 home. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges justify 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. |
| Chelsea Building Society | 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. |
| 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. |
| 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 |
Engaging our service gives you increased control over the value of your Rustington leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Last October Sebastian, came precariously near to the eighty-year mark with the lease on his one bedroom apartment in Rustington. Having bought his flat 19 years previously, the unexpired term was of minimal bearing. As luck would have it, he became aware that he needed to take steps soon on a lease extension. Sebastian was able to extend his lease just under the wire in May. Sebastian and the landlord who owned the flat above eventually agreed on a premium of £5,000 . If he failed to meet the deadline, the figure would have become more costly by at least £875.
Last Winter we were approach by Mr and Mrs. D Thomas , who bought a first floor flat in Rustington in November 2003. The dilemma was if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Similar homes in Rustington with an extended lease were in the region of £245,000. The average ground rent payable was £50 collected annually. The lease lapsed in 2093. Considering the 68 years left we calculated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 plus professional charges.
In 2013 we were contacted by Dr E García who, having acquired a studio flat in Rustington in February 2012. We are asked if we could shed any light on how much (approximately) price would be for a 90 year lease extension. Comparative residencies in Rustington with a long lease were in the region of £285,000. The average amount of ground rent was £55 billed quarterly. The lease termination date was in 2104. Taking into account 79 years left we approximated the compensation to the freeholder to extend the lease to be between £13,300 and £15,400 plus legals.