The basic rule is, all other factors being equal, the shorter the lease the more costly the premium. Qualifying leaseholders in Sutton have the right to extend the lease for a further ninety years in accordance with Leasehold Reform legislation. Please think carefully before delaying your Sutton lease extension. Shelving the costs now simply increases the premium you will eventually have to pay for a lease extension.
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 45 years remaining, the premises will be worth the same as a freehold for many years in the future.
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| 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. |
Retaining our service gives you better control over the value of your Sutton leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Following protracted negotiations with the landlord of her first floor apartment in Sutton, Mia commenced the lease extension process as the 80 year threshold was swiftly approaching. The legal work was concluded in March 2015. The freeholder’s costs were negotiated to below 450 pounds.
Mr and Mrs. M Lefèvre moved into a ground floor apartment in Sutton in November 2005. We are asked if we could shed any light on how much (approximately) price would likely be for a ninety year extension to my lease. Comparative flats in Sutton with an extended lease were valued about £275,000. The average ground rent payable was £55 collected every twelve months. The lease expired on 9 July 2102. Given that there were 76 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 plus legals.
An example of a Freehold Enfranchisement case for a Sutton flat is Buchanan Court 39 Vernon Road in April 2010. the Tribunal assessed that the premium payable for the freehold of the block should be £44,000. This case related to 2 flats. The unexpired residue of the current lease was 66.67 years.