The value of Sedbergh 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 escalate materialy once the remaining term is less than eighty years
Leasehold residencies in Sedbergh with more than one hundred years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and maintenance 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with handle Sedbergh 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.
Jason owned a studio flat in Sedbergh on the market with a lease of a few days over 72 years unexpired. Jason informally contacted his landlord a well known London-based freehold company for a lease extension. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £150 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Jason to exercise his statutory right. Jason obtained expert advice and secured satisfactory resolution without going to tribunal and sell the flat.
Last Summer we were contacted by Ms K Cooper , who took over the lease of a garden flat in Sedbergh in November 1998. We are asked if we could estimate the compensation to the landlord would be for a 90 year extension to my lease. Similar properties in Sedbergh with 100 year plus lease were valued around £173,800. The mid-range ground rent payable was £65 billed every twelve months. The lease elapsed in 2081. Given that there were 55 years left we estimated the premium to the freeholder to extend the lease to be within £31,400 and £36,200 exclusive of expenses.
Last month we were phoned by Mr Archie Wright , who took over the lease of a ground floor flat in Sedbergh in September 2010. We are asked if we could approximate the price would be to prolong the lease by a further 90 years. Similar premises in Sedbergh with a long lease were worth £235,200. The mid-range ground rent payable was £45 billed every twelve months. The lease end date was on 6 November 2092. Given that there were 66 years outstanding we calculated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of expenses.