Seaham leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. It is the case that most Seaham tenants have the right to extend their lease by an additional 90 years by virtue of the 1993 Leasehold Reform Act. Where you are a leasehold owner in Seaham you must see if your lease has between 70 and 90 years remaining. There are good reasons why a Seaham leaseholder with a lease having around eighty years unexpired should take steps to make sure that a lease extension is actioned without delay
Leasehold residencies in Seaham with over one hundred years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges warrant 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. |
| Chelsea 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with procure Seaham 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 conveyancing solicitor we work with provide it.
In 2014 Ali, came dangerously close to the 80-year threshold with the lease on his purpose- built apartment in Seaham. Having bought his property 19 years previously, the unexpired term was of little relevance. Luckily, he recognised he would imminently be paying way over the odds for a lease extension. Ali arranged for a lease extension at the eleventh hour last April. Ali and the freeholder via the management company ultimately settled on the final figure of £5,000 . If he had missed the deadline, the amount would have escalated by a minimum £1,100.
Last month we were phoned by Mr and Mrs. K García , who took over the lease of a one bedroom flat in Seaham in May 2009. The question was if we could shed any light on how much (approximately) compensation to the landlord would likely be to extend the lease by ninety years. Similar homes in Seaham with an extended lease were valued about £210,600. The mid-range ground rent payable was £45 invoiced annually. The lease elapsed on 18 May 2086. Given that there were 62 years unexpired we estimated the compensation to the freeholder to extend the lease to be within £18,100 and £20,800 exclusive of legals.
Last Spring we were called by Mr and Mrs. G Hill , who acquired a purpose-built apartment in Seaham in November 2002. We are asked if we could approximate the premium would likely be to prolong the lease by a further 90 years. Comparable flats in Seaham with 100 year plus lease were valued around £265,000. The average ground rent payable was £50 billed monthly. The lease lapsed in 2097. Taking into account 73 years as a residual term we approximated the premium to the landlord for the lease extension to be between £9,500 and £11,000 exclusive of expenses.