Sheffield leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. The majority of owners of residential leasehold property in Sheffield enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Sheffield you really ought to check if your lease has between seventy and ninety years remaining. There are good reasons why a Sheffield leaseholder with a lease having around 80 years remaining should take steps to make sure that a lease extension is actioned without delay
It is generally considered that a residential leasehold with more than 100 years remaining is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be worth the same as a freehold for decades to come.
| 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| 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. |
Using our service gives you enhanced control over the value of your Sheffield leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Toby owned a studio apartment in Sheffield being marketed with a lease of a few days over 72 years outstanding. Toby on an informal basis spoke with his landlord being a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a new rent initially set at £200 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Toby to exercise his statutory right. Toby procured expert advice and secured an acceptable deal without going to tribunal and sell the property.
Mr D Howard completed a studio flat in Sheffield in June 1997. The question was if we could shed any light on how much (approximately) price would be for a ninety year lease extension. Comparable residencies in Sheffield with an extended lease were in the region of £223,400. The mid-range amount of ground rent was £60 billed every twelve months. The lease concluded in 2085. Given that there were 59 years left we approximated the compensation to the landlord for the lease extension to be between £27,600 and £31,800 exclusive of professional charges.
Last Christmas we were contacted by Mr and Mrs. Y Robinson , who acquired a first floor apartment in Sheffield in January 1995. The question was if we could approximate the compensation to the landlord could be to extend the lease by ninety years. Comparative premises in Sheffield with 100 year plus lease were worth £205,000. The average amount of ground rent was £50 billed every twelve months. The lease terminated on 14 July 2105. Having 79 years left we approximated the premium to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of expenses.