As the the remaining lease term of a Hamworthy domestic lease lessens so does its value and therefore the value of your property. If the residual term has, over 100 years remaining then this decrease may be negligible nevertheless there will become a point in time when a lease has fewer than 80 years left as part of the premium you will incur is what is known as a marriage value. This could increase markedly the cost. It is the primary logic behind why you should extend the lease sooner rather than later. The majority of flat owners in Hamworthy will meet the qualifying criteria; nevertheless a lawyer can advise whether you qualify to extend your lease. In certain situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
It is conventional wisdom that a property with more than one hundred years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 30 years unexpired, the residence will be worth the same as a freehold for decades to come.
| 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. |
| 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with handle Hamworthy 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.
Dexter owned a conversion apartment in Hamworthy being marketed with a lease of fraction over fifty eight years unexpired. Dexter on an informal basis contacted his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £200 yearly. No ground rent would be payable on a lease extension were Dexter to invoke his statutory right. Dexter obtained expert legal guidance and was able to make an informed decision and deal with the matter and ending up with a market value flat.
In 2014 we were e-mailed by Mr E King who, having bought a studio apartment in Hamworthy in September 1996. The dilemma was if we could estimate the premium would be to prolong the lease by ninety years. Comparable homes in Hamworthy with an extended lease were worth £218,000. The average ground rent payable was £45 invoiced annually. The lease expiry date was on 22 March 2088. Taking into account 63 years as a residual term we calculated the compensation to the freeholder for the lease extension to be between £17,100 and £19,800 not including costs.
Mr Finn Williams purchased a garden flat in Hamworthy in March 2002. We are asked if we could shed any light on how much (roughly) premium could be for a ninety year extension to my lease. Comparable premises in Hamworthy with an extended lease were valued about £265,000. The mid-range amount of ground rent was £55 collected monthly. The lease ran out in 2099. Taking into account 74 years unexpired we estimated the premium to the landlord for the lease extension to be within £9,500 and £11,000 not including legals.