When it comes to long leasehold property in Sandringham, you are actually buying a right to live in a property for a prescribed time frame. In recent years flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you may think about a lease extension sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly particularly once there are fewer than 80 years left. Leasehold owners in Sandringham with a lease nearing 81 years left should seriously consider extending it without delay. When a lease has below 80 years outstanding, under the current Act the landlord is entitled to calculate and charge a larger premium, based on a technical calculation, strangely termed as “marriage value” which is payable.
Leasehold residencies in Sandringham with over 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 situations there is often little upside in buying the freehold unless savings on ground rent and estate charges justify 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
The conveyancers that we work with undertake Sandringham 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 lawyer we work with provide it.
Half a year ago Charlie, came very close to the eighty-year mark with the lease on his ground floor apartment in Sandringham. In buying his flat twenty years previously, the lease term was of minimal concern. Fortunately, it dawned on him that he would imminently be paying an escalated premium for a lease extension. Charlie arranged for a lease extension just under the wire in April. Charlie and the landlord who owned the flat above ultimately agreed on sum of £5,500 . If the lease had descended below 80 years, the price would have become more exhorbitant by at least £1,100.
Ms Danielle Peterson completed a garden apartment in Sandringham in February 2012. The question was if we could estimate the premium would likely be for a 90 year extension to my lease. Comparable homes in Sandringham with an extended lease were in the region of £205,000. The average amount of ground rent was £50 collected per annum. The lease lapsed on 10 January 2104. Having 79 years left we estimated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 exclusive of costs.
In 2009 we were approached by Mr and Mrs. L Sharif who, having acquired a garden apartment in Sandringham in July 2003. The question was if we could shed any light on how much (approximately) compensation to the landlord would be for a 90 year extension to my lease. Comparable flats in Sandringham with a long lease were worth £275,000. The average ground rent payable was £65 collected quarterly. The lease expiry date was on 28 May 2093. Considering the 68 years as a residual term we calculated the premium to the landlord for the lease extension to be within £13,300 and £15,400 plus professional charges.