It’s a harsh certainty that a Sandbach residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Sandbach property market.Once your lease nears 85ish years, you need to start considering a lease extension. If lease term slips below 80 years, you will then be required to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property The majority of flat owners in Sandbach will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm whether you qualify for an extension. In some cases you may not be entitled. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your lawyer throughout the formalities.
It is conventional wisdom that a property with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 35 years left, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with undertake Sandbach 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 conveyancing solicitor we work with provide it.
Trailing protracted correspondence with the freeholder of her basement apartment in Sandbach, Megan commenced the lease extension process just as the lease was nearing the all-important 80-year mark. The transaction was concluded in July 2012. The landlord’s charges were negotiated to slightly above 450 GBP.
In 2012 we were contacted by Mr and Mrs. A Richardson who, having owned a one bedroom flat in Sandbach in February 2003. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be for a ninety year extension to my lease. Comparative premises in Sandbach with an extended lease were valued about £255,000. The mid-range amount of ground rent was £50 invoiced annually. The lease terminated in 2097. Having 71 years outstanding we calculated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 not including legals.
Last February we were contacted by Dr W Bonnet , who purchased a one bedroom flat in Sandbach in November 2010. We are asked if we could estimate the compensation to the landlord would likely be for a 90 year extension to my lease. Comparable properties in Sandbach with a long lease were valued around £254,200. The mid-range amount of ground rent was £60 invoiced annually. The lease ended in 2077. Having 51 years outstanding we estimated the premium to the freeholder for the lease extension to be between £43,700 and £50,600 plus professional charges.