With a long leasehold property in Sutton Coldfield, you effectively rent it for a certain period of time. These days flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you may think about a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly especially when there are fewer than 80 years remaining. Residents in Sutton Coldfield with a lease approaching 81 years unexpired should seriously think of extending it as soon as possible. Once a lease has less than eighty years outstanding, under the relevant statute the freeholder can calculate and charge a larger amount, assessed on a technical calculation, strangely termed as “marriage value” which is payable.
It is conventional wisdom that a property with in excess of 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years left, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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 |
| 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 Sutton Coldfield 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 lawyer we work with provide it.
Trailing unsuccessful discussions with the freeholder of her first floor flat in Sutton Coldfield, Sophia commenced the lease extension process just as the lease was nearing the all-important 80-year threshold. The legal work completed in February 2006. The freeholder’s fees were kept to an absolute minimum.
In 2012 we were e-mailed by Dr Lauren Rose who, having acquired a basement apartment in Sutton Coldfield in October 2005. We are asked if we could estimate the price would likely be for a ninety year lease extension. Similar premises in Sutton Coldfield with an extended lease were worth £210,600. The average amount of ground rent was £45 collected per annum. The lease expired on 25 July 2087. Given that there were 62 years unexpired we estimated the premium to the freeholder for the lease extension to be within £18,100 and £20,800 not including costs.
Last Winter we were called by Ms A Robinson , who acquired a garden flat in Sutton Coldfield in June 2005. The dilemma was if we could shed any light on how much (approximately) premium could be for a 90 year lease extension. Comparative homes in Sutton Coldfield with 100 year plus lease were worth £265,000. The mid-range amount of ground rent was £50 billed annually. The lease expired in 2098. Having 73 years remaining we estimated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 not including expenses.