Thurrock leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Thurrock residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Thurrock you must check if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under 80 years, the compensation to the landlord for any lease extension increases dramatically as part of the premium you will incur is what is known as a marriage value
It is generally accepted that a residential leasehold with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 35 years left, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
Retaining our service gives you enhanced control over the value of your Thurrock leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Noah owned a high value apartment in Thurrock on the market with a lease of fraction over 72 years remaining. Noah informally spoke with his landlord a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a rise in the rent to £125 yearly. Ordinarily, ground rent would not be due on a lease extension were Noah to invoke his statutory right. Noah obtained expert advice and was able to make a more informed judgement and deal with the matter and sell the flat.
Dr Jonathan Lambert purchased a one bedroom apartment in Thurrock in January 1997. The dilemma was if we could estimate the price could be for a 90 year lease extension. Comparative premises in Thurrock with 100 year plus lease were valued around £216,000. The mid-range amount of ground rent was £60 collected monthly. The lease ran out on 21 August 2083. Having 58 years outstanding we estimated the premium to the freeholder for the lease extension to be within £28,500 and £33,000 not including costs.
Dr S Thompson moved into a one bedroom apartment in Thurrock in November 2008. We are asked if we could shed any light on how much (approximately) premium would likely be to extend the lease by a further 90 years. Comparable residencies in Thurrock with a long lease were in the region of £205,000. The mid-range amount of ground rent was £50 invoiced per annum. The lease concluded on 13 June 2103. Considering the 78 years unexpired we approximated the premium to the landlord to extend the lease to be between £8,600 and £9,800 exclusive of professional charges.