The market value of a leasehold property in Lewes is impacted by how many years the lease has remaining. If it is close to or less than 80 years you should expect problems on re-sale, so it is advisable to arrange for a lease extension ahead of buying. It is preferable to start the lease extension process when a lease still has 82 years unexpired so that formalities can be concluded ahead of the eighty year mark. Current legislation entitles Lewes qualifying lessees to obtain a new lease which will be for the current unexpired lease term plus a supplemental term of ninety years. The purpose of the valuation is to determine the sum payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a residential leasehold with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| 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. |
| 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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 undertake Lewes 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 conveyancer we work with provide it.
Michael was the the leasehold proprietor of a conversion flat in Lewes being sold with a lease of just over 61 years left. Michael on an informal basis approached his freeholder a well known Manchester-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and doubled every 25 years thereafter. No ground rent would be due on a lease extension were Michael to exercise his statutory right. Michael obtained expert legal guidance and secured an acceptable resolution without resorting to tribunal and readily saleable.
Last Winter we were phoned by Mr and Mrs. A Dupont , who purchased a first floor flat in Lewes in July 2001. The question was if we could shed any light on how much (roughly) compensation to the landlord would likely be to prolong the lease by a further 90 years. Similar premises in Lewes with a long lease were worth £280,000. The mid-range amount of ground rent was £55 collected quarterly. The lease ended in 2104. Given that there were 78 years remaining we approximated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 exclusive of legals.
In 2014 we were e-mailed by Mrs Anna Fournier who, having completed a basement flat in Lewes in November 1996. The dilemma was if we could approximate the price would likely be for a ninety year lease extension. Similar homes in Lewes with 100 year plus lease were worth £191,000. The average ground rent payable was £65 collected monthly. The lease expired on 5 June 2084. Taking into account 58 years left we estimated the premium to the landlord to extend the lease to be within £23,800 and £27,400 plus legals.