It’s an underpublicised certainty that a Lewes residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the reduction being disguised by increases in the Lewes property market.Where your lease has approximately ninety years left, you need to 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 falls lower than 80 years - otherwise a higher amount will be payable. The majority of leasehold owners in Lewes will be able to extend under the legislation; however a lawyer should be able to clarify whether you are eligibility. In some situations you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
Leasehold premises in Lewes with over one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and service charges justify 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; |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Regardless of whether you are a tenant or a freeholder in Lewes,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Lewes valuers.
Last October Kai, started to get near to the eighty-year mark with the lease on his purpose- built apartment in Lewes. In buying his home 19 years previously, the lease term was of minimal concern. Thankfully, he realised he would imminently be paying way over the odds for a lease extension. Kai extended the lease just in the nick of time last September. Kai and the freeholder via the management company in the end agreed on a premium of £6,000 . If he not met the deadline, the figure would have increased by at least £975.
Last August we were e-mailed by Dr G Green , who was assigned a lease of a first floor flat in Lewes in June 1995. We are asked if we could estimate the compensation to the landlord could be for a ninety year lease extension. Comparable properties in Lewes with a long lease were worth £260,000. The average amount of ground rent was £50 billed annually. The lease expired on 24 September 2098. Taking into account 72 years left we estimated the premium to the landlord to extend the lease to be within £9,500 and £11,000 exclusive of fees.
Mr and Mrs. M Williams purchased a one bedroom apartment in Lewes in September 1999. The dilemma was if we could estimate the compensation to the landlord would likely be for a ninety year lease extension. Comparable premises in Lewes with a long lease were in the region of £261,600. The mid-range amount of ground rent was £60 invoiced yearly. The lease came to a finish in 2078. Given that there were 52 years outstanding we calculated the compensation to the freeholder for the lease extension to be between £39,000 and £45,000 plus fees.