On the balance of probabilities where you own a flat in Highcliffe you actually own a long leasehold interest over your property
Leasehold properties in Highcliffe with more than one hundred years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Chelsea 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
The conveyancing solicitors that we work with procure Highcliffe 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.
In 2014 Stanley, came perilously near to the 80-year threshold with the lease on his two bedroom flat in Highcliffe. Having bought his property 18 years ago, the unexpired term was of minimal bearing. by good luck, he noticed he needed to take action soon on Extending the lease. Stanley extended the lease at the eleventh hour last July. Stanley and the freeholder eventually agreed on sum of £5,500 . If he failed to meet the deadline, the premium would have increased by a minimum £1,100.
In 2013 we were approached by Mr S Cox who, having owned a garden apartment in Highcliffe in June 2010. We are asked if we could shed any light on how much (approximately) premium could be to prolong the lease by 90 years. Similar homes in Highcliffe with 100 year plus lease were valued about £235,200. The mid-range ground rent payable was £45 collected annually. The lease termination date was in 2092. Given that there were 66 years left we estimated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 plus expenses.
In 2013 we were called by Mr and Mrs. Y Lambert who, having owned a one bedroom apartment in Highcliffe in August 1999. The question was if we could estimate the premium would likely be to prolong the lease by a further 90 years. Similar premises in Highcliffe with an extended lease were worth £275,000. The average ground rent payable was £55 billed annually. The lease ended on 21 October 2103. Given that there were 77 years remaining we calculated the premium to the landlord for the lease extension to be between £13,300 and £15,400 not including fees.