The re-sale value of a leasehold property in Seven Sisters depends on how long the lease has remaining. If it is close to or fewer than eighty years you should expect difficulties on re-sale, so it is advisable to arrange for a lease extension prior to purchasing. Ideally one should start the lease extension process when a lease still has 82 years remaining so that formalities can be finalised in advance of the 80 year threshold. Leasehold Reform legislation enables Seven Sisters qualifying lessees to a ninety year extension added to their residual lease term (ie if your lease has 50 years left the statutory lease extension will provide a new term of 140 years). The reason of the valuation is to arrive at an opinion of 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 more than 100 years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 30 years remaining, the property will be equivalent in value to a freehold for many years ahead.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
The conveyancers that we work with procure Seven Sisters 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.
Two years ago Max, came very close to the 80-year mark with the lease on his ground floor apartment in Seven Sisters. Having bought his property two decades ago, the length of the lease was of little importance. Fortunately, it dawned on him that he needed to take steps soon on Extending the lease. Max arranged for a lease extension just under the wire in September. Max and the landlord ultimately settled on sum of £6,000 . If the lease had fallen below 80 years, the sum would have escalated by a minimum £875.
Mr and Mrs. E López completed a recently refurbished flat in Seven Sisters in May 1999. The question was if we could approximate the compensation to the landlord would be for a 90 year extension to my lease. Comparative flats in Seven Sisters with an extended lease were worth £206,200. The average ground rent payable was £60 collected monthly. The lease terminated in 2082. Given that there were 56 years unexpired we calculated the premium to the landlord to extend the lease to be within £32,300 and £37,400 not including costs.
An example of a Freehold Enfranchisement case for a Seven Sisters residence is 22 Wakefield Road in January 2012. Following a vesting order Clerkenwell and Shoreditch County Court under section 26 of the Leasehold Reform,Housing and Urban Development Act 1993 on 9th May 2011 the Tribunal decided that the price that the Applicant for the freehold interest should pay is £17,400 This case related to 2 flats. The unexpired term as at the valuation date was 74.13 years.