With a long leasehold premises in Sanderstead, you are in fact renting it for a certain amount of time. In recent years flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you should think about a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately greater notably once there are less than eighty years remaining. Anyone in Sanderstead with a lease nearing 81 years remaining should seriously consider extending it as soon as possible. Once a lease has under eighty years remaining, under the current statute the freeholder can calculate and levy a larger premium, assessed on a technical multiplication, strangely termed as “marriage value” which is due.
Leasehold residencies in Sanderstead with more than one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and service charges merit 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. |
| Birmingham Midshires | Minimum 70 years from the date 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with handle Sanderstead 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 conveyancer we work with provide it.
Alexander owned a 2 bedroom flat in Sanderstead being sold with a lease of just over sixty years left. Alexander informally contacted his freeholder a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £50 yearly. No ground rent would be due on a lease extension were Alexander to invoke his statutory right. Alexander obtained expert advice and was able to make an informed judgement and handle with the matter and ending up with a market value flat.
In 2010 we were called by Dr Finn Flores who, having purchased a ground floor apartment in Sanderstead in June 2010. We are asked if we could approximate the compensation to the landlord would likely be to prolong the lease by an additional years. Similar premises in Sanderstead with a long lease were in the region of £198,800. The mid-range amount of ground rent was £55 invoiced annually. The lease ended in 2081. Taking into account 55 years unexpired we approximated the compensation to the freeholder to extend the lease to be between £33,300 and £38,400 not including costs.
An example of a Freehold Enfranchisement case for a Sanderstead premises is The Woodlands 95 Purley Park Road in April 2009. The Tribunals own valuation produced the figure of £37,912. This case affected 6 flats. The unexpired term was 78.32 years.