It’s a harsh truth that a Sherburn In Elmet residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Sherburn In Elmet property market.Where your lease has approximately 90 years left, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips below 80 years - otherwise a higher amount will be payable. The majority of leasehold owners in Sherburn In Elmet will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify whether you qualify for an extension. In some situations you may not qualify. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer throughout the formalities.
Leasehold residencies in Sherburn In Elmet with in excess of 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| 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; |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
The lawyers that we work with handle Sherburn In Elmet 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.
Connor owned a studio apartment in Sherburn In Elmet on the market with a lease of a few days over sixty years left. Connor informally contacted his landlord being a well known Manchester-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent initially set at £150 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Connor to exercise his statutory right. Connor obtained expert legal guidance and was able to make a more informed judgement and handle with the matter and readily saleable.
In 2014 we were e-mailed by Mr Callum Laurent who, having acquired a purpose-built flat in Sherburn In Elmet in September 2004. We are asked if we could estimate the price could be for a 90 year extension to my lease. Similar premises in Sherburn In Elmet with an extended lease were worth £280,000. The mid-range ground rent payable was £55 invoiced yearly. The lease lapsed on 25 March 2104. Having 78 years remaining we calculated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 not including fees.
Mrs F Stewart purchased a basement apartment in Sherburn In Elmet in February 1995. The question was if we could estimate the compensation to the landlord could be for a ninety year lease extension. Comparable homes in Sherburn In Elmet with a long lease were valued about £191,000. The mid-range amount of ground rent was £65 collected annually. The lease concluded in 2084. Considering the 58 years outstanding we calculated the premium to the freeholder for the lease extension to be within £23,800 and £27,400 not including professional charges.