The re-sale value of a leasehold property in Seascale is impacted by how long the lease has remaining. If it is near to or less than eighty years you should anticipate problems on re-sale, so it is advisable to arrange for the lease to be extended prior to purchasing. It is preferable to start the process of extending the lease is when a lease still has 82 years remaining so that formalities can be addressed ahead of the 80 year mark. Statute enables Seascale qualifying lessees to a ninety year extension added to their unexpired lease term (ie if your lease has fifty years left the statutory lease extension will provide a new term of 140 years). The purpose of the valuation is to determine the premium payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be equivalent in value to 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. |
| Birmingham Midshires | 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. |
| 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. |
Retaining our service will provide you increased control over the value of your Seascale leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In the wake of 9 months of protracted negotiations with the freeholder of her leasehold flat in Seascale, Amelia started the lease extension process just as her lease was approaching the critical 80-year deadline. The legal work was concluded in February 2015. The freeholder’s fees were restricted to a tad over 450 pounds.
In 2011 we were e-mailed by Mr and Mrs. H Lefebvre who, having took over the lease of a basement flat in Seascale in August 2011. The question was if we could approximate the price would be to prolong the lease by a further 90 years. Similar properties in Seascale with a long lease were valued around £227,800. The mid-range amount of ground rent was £45 billed every twelve months. The lease ran out in 2091. Taking into account 65 years left we calculated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 exclusive of fees.
Last Winter we were phoned by Mrs P Clarke , who completed a purpose-built apartment in Seascale in February 2010. The question was if we could shed any light on how much (roughly) compensation to the landlord would be for a ninety year extension to my lease. Similar properties in Seascale with a long lease were valued around £270,000. The mid-range amount of ground rent was £55 collected every twelve months. The lease ended in 2101. Having 75 years unexpired we estimated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 plus costs.