When it comes to residential leasehold property in Sedbergh, you are in fact renting it for a certain period of time. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you should consider a lease extension sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly particularly when there are less than eighty years remaining. Residents in Sedbergh with a lease approaching 81 years unexpired should seriously consider extending it as soon as possible. When a lease has below eighty years left, under the relevant legislation the landlord can calculate and levy a greater premium, based on a technical calculation, strangely termed as “marriage value” which is due.
Leasehold residencies in Sedbergh with more than 100 years left on the lease are often regarded as a ‘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 buying the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
Regardless of whether you are a tenant or a landlord in Sedbergh,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Sedbergh valuers.
Lucas owned a studio flat in Sedbergh being marketed with a lease of fraction over 59 years left. Lucas on an informal basis contacted his landlord being a well known London-based freehold company for a lease extension. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £100 per annum. Ordinarily, ground rent would not be payable on a lease extension were Lucas to exercise his statutory right. Lucas procured expert legal guidance and secured satisfactory resolution informally and sell the flat.
Last July we were called by Mr and Mrs. P Díaz , who was assigned a lease of a purpose-built flat in Sedbergh in June 1998. We are asked if we could approximate the premium could be for a 90 year extension to my lease. Comparable premises in Sedbergh with a long lease were worth £198,400. The mid-range amount of ground rent was £65 collected monthly. The lease expired on 12 October 2085. Considering the 59 years remaining we estimated the compensation to the landlord to extend the lease to be between £21,900 and £25,200 not including professional charges.
In 2014 we were approached by Dr Y Green who, having moved into a recently refurbished flat in Sedbergh in November 1997. We are asked if we could estimate the compensation to the landlord would likely be for a ninety year lease extension. Identical flats in Sedbergh with an extended lease were valued about £255,000. The average ground rent payable was £50 invoiced monthly. The lease ended in 2096. Taking into account 70 years outstanding we calculated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 plus professional charges.