With a long leasehold property in Sawbridgeworth, you effectively rent it for a certain amount of time. Modern flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you should think about extending the lease sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly especially once there are fewer than 80 years left. Anyone in Sawbridgeworth with a lease drawing near to 81 years left should seriously consider extending it sooner than later. Once the lease term has under 80 years remaining, under the relevant statute the freeholder is entitled to calculate and demand a larger premium, based on a technical computation, known as “marriage value” which is due.
It is generally considered that a property with more than one hundred years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the property will be worth the same as a freehold for decades to come.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Irrespective of whether you are a tenant or a landlord in Sawbridgeworth,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Sawbridgeworth valuers.
Aaron owned a 2 bedroom apartment in Sawbridgeworth being marketed with a lease of a few days over sixty years unexpired. Aaron informally approached his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent at the outset set at £100 per annum and doubled every twenty five years thereafter. No ground rent would be payable on a lease extension were Aaron to invoke his statutory right. Aaron procured expert advice and secured an acceptable resolution without going to tribunal and readily saleable.
Mr and Mrs. N Rivera was assigned a lease of a garden flat in Sawbridgeworth in June 2007. We are asked if we could estimate the premium would be to prolong the lease by an additional years. Identical residencies in Sawbridgeworth with 100 year plus lease were valued about £205,000. The mid-range ground rent payable was £50 billed yearly. The lease expired in 2105. Having 79 years outstanding we estimated the compensation to the freeholder for the lease extension to be between £7,600 and £8,800 not including costs.
In 2009 we were phoned by Ms Danielle Martinez who, having purchased a studio apartment in Sawbridgeworth in November 2000. We are asked if we could approximate the premium could be for a ninety year extension to my lease. Identical flats in Sawbridgeworth with a long lease were in the region of £275,000. The average amount of ground rent was £65 invoiced quarterly. The lease concluded on 23 July 2094. Taking into account 68 years remaining we calculated the compensation to the freeholder to extend the lease to be within £13,300 and £15,400 not including professional charges.