The market value of Sanderstead leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can escalate significantly once the remaining term is below than eighty years
Leasehold residencies in Sanderstead with in excess of one hundred years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service gives you enhanced control over the value of your Sanderstead leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Ali was the the leasehold proprietor of a studio apartment in Sanderstead on the market with a lease of fraction over 72 years outstanding. Ali informally contacted his landlord a well known Bristol-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent initially set at £200 per annum and doubled every twenty five years thereafter. No ground rent would be payable on a lease extension were Ali to exercise his statutory right. Ali obtained expert advice and secured satisfactory deal informally and readily saleable.
Ms Alexandra Morel purchased a purpose-built flat in Sanderstead in November 2011. The question was if we could shed any light on how much (roughly) compensation to the landlord would likely be to prolong the lease by ninety years. Comparable residencies in Sanderstead with 100 year plus lease were worth £285,000. The average amount of ground rent was £45 billed monthly. The lease lapsed in 2096. Considering the 71 years unexpired we approximated the compensation to the landlord for the lease extension to be between £12,400 and £14,200 plus expenses.
An example of a Freehold Enfranchisement decision 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 was in relation to 6 flats. The unexpired term as at the valuation date was 78.32 years.