On the balance of probabilities if you own a flat in Sheerness you actually own a long leasehold interest over your property
Leasehold residencies in Sheerness with in excess of 100 years left on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 |
The lawyers that we work with handle Sheerness 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 conveyancing solicitor we work with provide it.
Last year Archie, started to get near to the 80-year mark with the lease on his basement flat in Sheerness. Having purchased his property 19 years previously, the unexpired term was of no relevance. As luck would have it, he realised he needed to take action soon on Extending the lease. Archie arranged for a lease extension just ahead of time last April. Archie and the landlord who owned the flat above subsequently agreed on sum of £6,000 . If he failed to meet the deadline, the figure would have become more exhorbitant by a minimum £950.
Last Summer we were called by Mr U Turner , who owned a one bedroom apartment in Sheerness in November 2008. We are asked if we could shed any light on how much (approximately) premium would be for a 90 year extension to my lease. Identical properties in Sheerness with 100 year plus lease were in the region of £300,000. The average amount of ground rent was £50 invoiced yearly. The lease ended in 2101. Taking into account 76 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 plus fees.
Mr and Mrs. G Parker completed a purpose-built apartment in Sheerness in January 2004. We are asked if we could approximate the premium would likely be for a ninety year extension to my lease. Comparative residencies in Sheerness with an extended lease were valued about £257,800. The average ground rent payable was £65 collected annually. The lease terminated on 24 August 2090. Having 65 years unexpired we approximated the compensation to the freeholder for the lease extension to be between £17,100 and £19,800 not including fees.