Owning a apartment usually means owning a lease of the property, which has a finite term of years. This lease will normally be granted for a prescribed period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Selsey. Clearly, the term of lease left reduces over time. This may slip by relatively unnoticed when the residence needs to be sold or re-mortgaged. The shorter the lease the lower the value of the property and the more it will cost to extend the lease. Qualifying leaseholders in Selsey have the legal entitlement to extend the lease for a further 90 years in accordance with the 1993 Leasehold Reform Act. Do give careful attention before delaying your Selsey lease extension. Putting off the cost now only increases the price you will eventually incur for a lease extension
Leasehold properties in Selsey 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 upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges merit it.
| 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. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Retaining our service will provide you better control over the value of your Selsey leasehold, as your property will be more valuable and saleable in relation to the 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.
Archie was the the leasehold owner of a studio flat in Selsey on the market with a lease of fraction over 61 years outstanding. Archie informally spoke with his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent initially set at £100 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Archie to invoke his statutory right. Archie procured expert advice and secured satisfactory deal without resorting to tribunal and readily saleable.
Last September we were called by Dr W Gunderson , who moved into a studio flat in Selsey in August 2012. The question was if we could approximate the compensation to the landlord would be to prolong the lease by ninety years. Comparable premises in Selsey with 100 year plus lease were worth £200,800. The average ground rent payable was £65 billed monthly. The lease expired on 1 April 2085. Given that there were 60 years unexpired we calculated the premium to the landlord for the lease extension to be between £20,900 and £24,200 exclusive of costs.
Mr and Mrs. M Simon moved into a one bedroom flat in Selsey in March 2002. The question was if we could approximate the price would likely be to prolong the lease by ninety years. Similar flats in Selsey with 100 year plus lease were valued about £255,000. The average ground rent payable was £50 collected yearly. The lease elapsed in 2096. Having 71 years left we estimated the premium to the landlord for the lease extension to be within £9,500 and £11,000 plus expenses.