Owning a apartment usually means owning a lease of the property, which has a finite term of years. your lease will ordinarily be granted for a prescribed period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Sheffield. Clearly, the length of lease left shortens as time goes by. This may slip by relatively unnoticed when the residence needs to be disposed of or refinanced. The shorter the lease the less it is worth and the more it will cost to obtain a lease extension. Qualifying long lease owners in Sheffield have the legal entitlement to extend the lease for an additional ninety years under legislation. Please give due attention before putting off your Sheffield lease extension. Holding off the cost now only increases the price you will ultimately incur for a lease extension
It is conventional wisdom that a property with over 100 years remaining is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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; |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Irrespective of whether you are a tenant or a landlord in Sheffield,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Sheffield valuers.
Off the back of lengthy negotiations with the freeholder of her leasehold flat in Sheffield, Samantha started the lease extension process just as the lease was nearing the all-important 80-year mark. The transaction was concluded in January 2007. The freeholder’s charges were restricted to below 450 GBP.
Mrs S Hernández acquired a basement flat in Sheffield in April 2012. We are asked if we could approximate the compensation to the landlord would likely be to extend the lease by 90 years. Similar flats in Sheffield with an extended lease were in the region of £295,000. The mid-range ground rent payable was £50 billed per annum. The lease finished in 2100. Taking into account 75 years outstanding we calculated the compensation to the landlord for the lease extension to be within £8,600 and £9,800 exclusive of legals.
In 2010 we were approached by Dr Jonathan Harris who, having completed a one bedroom apartment in Sheffield in March 1995. The question was if we could approximate the compensation to the landlord would likely be for a 90 year extension to my lease. Identical properties in Sheffield with a long lease were valued about £250,400. The average amount of ground rent was £65 invoiced annually. The lease ran out on 16 March 2089. Considering the 64 years as a residual term we approximated the compensation to the landlord to extend the lease to be within £19,000 and £22,000 plus costs.