It’s a harsh truth that a Sipson residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Sipson property prices.Once your lease nears 85ish years, you should 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 dips below 80 years - otherwise a higher premium will be payable. Most leasehold owners in Sipson will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify whether you are eligibility. In some cases you may not be entitled. There are also strict timeframes and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
It is conventional wisdom that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 35 years left, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| Godiva Mortgages | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service will provide you increased control over the value of your Sipson leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Last Winter Joseph, came precariously close to the eighty-year threshold with the lease on his leasehold flat in Sipson. Having bought his property 19 years previously, the unexpired term was of little relevance. Fortunately, he became aware that he needed to take action soon on Extending the lease. Joseph was able to extend his lease just in the nick of time in August. Joseph and the landlord who owned the flat above eventually settled on an amount of £5,000 . If the lease had slid to less than eighty years, the figure would have escalated by at least £850.
Mr and Mrs. E Cooper bought a first floor apartment in Sipson in November 1997. We are asked if we could shed any light on how much (approximately) premium would be for a 90 year extension to my lease. Comparable flats in Sipson with a long lease were in the region of £275,000. The average amount of ground rent was £55 invoiced yearly. The lease lapsed in 2103. Given that there were 77 years unexpired we approximated the premium to the freeholder to extend the lease to be between £13,300 and £15,400 plus costs.
An example of a Freehold Enfranchisement decision for a Sipson property is 164 Nestles Avenue in October 2013. The tribunal agreed with the proposed price of £20,158 for the freehold and determined that that sum is the amount to be paid into court This case affected 2 flats. The remaining number of years on the lease was 69 years.