It’s an underpublicised truth that a Sutton On Sea residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Sutton On Sea property prices.Where your lease has approximately ninety years left, you should start considering 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 under 80 years - otherwise a higher amount will be due. Most leasehold owners in Sutton On Sea will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify whether you are eligibility. In some situations you may not be entitled. There are also strict timeframes and procedures to follow once the process is instigated and you will need to be guided by your conveyancer throughout the formalities.
Leasehold premises in Sutton On Sea with more than one hundred years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges justify it.
| 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
Irrespective of whether you are a tenant or a landlord in Sutton On Sea,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 experience and the close ties they enjoy with Sutton On Sea valuers.
Seth was the the leasehold proprietor of a high value flat in Sutton On Sea being marketed with a lease of a little over 72 years remaining. Seth informally contacted his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £100 yearly. No ground rent would be due on a lease extension were Seth to invoke his statutory right. Seth procured expert advice and secured an acceptable resolution informally and readily saleable.
Last Spring we were approach by Mr and Mrs. P Moore , who acquired a first floor flat in Sutton On Sea in July 1998. The question was if we could estimate the compensation to the landlord could be to extend the lease by a further 90 years. Comparative homes in Sutton On Sea with a long lease were in the region of £166,800. The mid-range amount of ground rent was £50 collected per annum. The lease lapsed on 26 July 2075. Given that there were 50 years left we estimated the compensation to the freeholder to extend the lease to be within £32,300 and £37,400 plus fees.
In 2014 we were called by Mr and Mrs. F Hill who, having owned a one bedroom flat in Sutton On Sea in June 2008. The question was if we could estimate the premium would likely be for a ninety year lease extension. Similar premises in Sutton On Sea with an extended lease were worth £280,000. The average amount of ground rent was £45 invoiced yearly. The lease expired on 6 November 2095. Given that there were 70 years unexpired we approximated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 exclusive of legals.