On the balance of probabilities where you own a flat in Peacehaven you actually own a long leasehold interest over your property
Leasehold residencies in Peacehaven with more than 100 years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and maintenance 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. |
| 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. |
| 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. |
| 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 conveyancers that we work with handle Peacehaven 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 conveyancing solicitor we work with provide it.
In 2014 Isaac, started to get close to the eighty-year threshold with the lease on his leasehold apartment in Peacehaven. Having purchased his home two decades ago, the length of the lease was of minimal interest. Thankfully, he became aware that he would soon be paying an inflated amount for a lease extension. Isaac was able to extend his lease just under the wire in May. Isaac and the landlord who owned the flat above in the end agreed on an amount of £5,500 . If the lease had fallen below 80 years, the premium would have escalated by at least £950.
In 2013 we were called by Mrs J Gunderson who, having completed a recently refurbished flat in Peacehaven in July 2003. The question was if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Similar homes in Peacehaven with a long lease were in the region of £223,400. The mid-range amount of ground rent was £60 collected per annum. The lease came to a finish on 15 May 2084. Considering the 59 years unexpired we calculated the premium to the landlord to extend the lease to be between £27,600 and £31,800 exclusive of fees.
In 2009 we were e-mailed by Mr and Mrs. E Rodríguez who, having owned a purpose-built apartment in Peacehaven in October 2003. We are asked if we could approximate the premium would likely be to extend the lease by an additional years. Identical flats in Peacehaven with a long lease were in the region of £205,000. The average amount of ground rent was £50 billed yearly. The lease ran out on 5 January 2104. Having 79 years as a residual term we estimated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 plus costs.