The value of Sacriston leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can increase significantly once the remaining term is less than eighty years
Leasehold properties in Sacriston 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 to be gained by buying the freehold unless savings on ground rent and estate charges merit 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with procure Sacriston 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.
Jacob owned a high value apartment in Sacriston on the market with a lease of fraction over fifty eight years unexpired. Jacob informally contacted his landlord a well known London-based freehold company for a lease extension. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £100 annually. No ground rent would be due on a lease extension were Jacob to exercise his statutory right. Jacob obtained expert legal guidance and was able to make an informed judgement and deal with the matter and ending up with a market value flat.
Last Winter we were phoned by Mr and Mrs. L Johnson , who bought a one bedroom flat in Sacriston in March 2008. We are asked if we could estimate the compensation to the landlord could be to prolong the lease by 90 years. Identical properties in Sacriston with an extended lease were valued about £295,000. The average ground rent payable was £45 collected monthly. The lease concluded in 2099. Considering the 74 years left we approximated the premium to the landlord for the lease extension to be within £9,500 and £11,000 not including fees.
In 2012 we were phoned by Mr Jake Martin who, having bought a garden apartment in Sacriston in October 2001. We are asked if we could shed any light on how much (roughly) premium would be for a 90 year lease extension. Similar homes in Sacriston with 100 year plus lease were in the region of £248,000. The mid-range ground rent payable was £65 collected per annum. The lease expired in 2088. Taking into account 63 years as a residual term we estimated the premium to the freeholder for the lease extension to be within £20,900 and £24,200 not including legals.