For anyone whose Sheffield home is held on a long lease, our message is clear – if you do nothing, the property will ultimately revert to your landlord, leaving you empty-handed. The fewer the years remaining the less it is worth and the more expensive it will be to obtain a lease extension.
Leasehold premises in Sheffield with more than one hundred years unexpired 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 freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Lease extensions in Sheffield can be a difficult process. We recommend you secure guidance from a conveyancer and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Sheffield lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Evan owned a studio flat in Sheffield on the market with a lease of a few days over 59 years remaining. Evan on an informal basis spoke with his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent at the outset set at £100 per annum and increase every 25 years thereafter. No ground rent would be payable on a lease extension were Evan to invoke his statutory right. Evan procured expert advice and secured satisfactory deal informally and readily saleable.
In 2009 we were called by Dr Alexander Hill who, having owned a purpose-built apartment in Sheffield in March 2003. We are asked if we could estimate the premium would be for a ninety year extension to my lease. Identical premises in Sheffield with a long lease were valued about £210,000. The average amount of ground rent was £50 billed every twelve months. The lease expired in 2105. Having 80 years remaining we calculated the compensation to the freeholder to extend the lease to be within £8,600 and £9,800 plus costs.
In 2010 we were called by Mr N Moore who, having owned a one bedroom flat in Sheffield in January 2007. We are asked if we could estimate the premium would be for a 90 year lease extension. Identical residencies in Sheffield with an extended lease were in the region of £275,000. The mid-range ground rent payable was £45 collected monthly. The lease expired in 2094. Taking into account 69 years left we estimated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 exclusive of fees.