There is no doubt about it a leasehold property in Sedgefield is a wasting asset as a result of the diminishing lease term. Where the residual term has, in excess of one hundred years remaining then this decrease may be of little impact however there will become a stage when a lease has fewer than eighty years left as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main logic behind why you should extend the lease without delay. Most flat owners in Sedgefield will qualify for this right; nevertheless a conveyancer can confirm if you qualify to extend your lease. In limited situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 30 years remaining, the property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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. |
| Godiva Mortgages | 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. |
| 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 |
Engaging our service will provide you better control over the value of your Sedgefield leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
18 months ago Liam, came dangerously near to the 80-year mark with the lease on his studio apartment in Sedgefield. Having purchased his property 19 years ago, the unexpired term was of no interest. Fortunately, it dawned on him that he would imminently be paying an escalated premium for a lease extension. Liam arranged for a lease extension just under the wire in July. Liam and the landlord who owned the flat above in the end settled on a premium of £5,000 . If the lease had dropped below 80 years, the sum would have escalated by at least £850.
In 2010 we were contacted by Mr and Mrs. U Green who, having completed a basement flat in Sedgefield in August 2000. We are asked if we could shed any light on how much (approximately) price would be for a ninety year extension to my lease. Identical premises in Sedgefield with an extended lease were valued around £173,800. The average amount of ground rent was £60 collected quarterly. The lease elapsed in 2080. Considering the 55 years remaining we approximated the compensation to the freeholder for the lease extension to be within £31,400 and £36,200 plus legals.
In 2012 we were approached by Dr H Johnson who, having completed a basement flat in Sedgefield in April 2012. The question was if we could estimate the premium could be for a 90 year lease extension. Identical flats in Sedgefield with 100 year plus lease were in the region of £235,200. The mid-range ground rent payable was £45 billed quarterly. The lease lapsed in 2091. Given that there were 66 years remaining we calculated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 not including fees.