The value of Seaforth leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can increase significantly once the remaining term is less than 80 years
Leasehold properties in Seaforth with over 100 years left 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 property. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
| Yorkshire Building Society | 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. |
The conveyancing solicitors that we work with undertake Seaforth 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.
In the wake of 6 months of unsuccessful correspondence with the landlord of her leasehold flat in Seaforth, Rachel commenced the lease extension process just as the lease was nearing the all-important eighty-year mark. The lease extension completed in April 2015. The freeholder’s costs were restricted to about 700 GBP.
Last year we were called by Mr and Mrs. K Stewart , who bought a garden flat in Seaforth in August 2012. We are asked if we could shed any light on how much (roughly) price would be for a ninety year lease extension. Comparable homes in Seaforth with a long lease were in the region of £189,000. The average amount of ground rent was £55 invoiced monthly. The lease concluded in 2078. Taking into account 53 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £28,500 and £33,000 plus fees.
In 2013 we were contacted by Mr and Mrs. R Stewart who, having purchased a one bedroom flat in Seaforth in November 2005. We are asked if we could shed any light on how much (approximately) compensation to the landlord could be for a ninety year lease extension. Comparative premises in Seaforth with an extended lease were valued around £290,000. The average amount of ground rent was £45 invoiced per annum. The lease expired on 28 November 2098. Given that there were 73 years remaining we approximated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 exclusive of fees.