Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will normally be granted for a set period of time , ordinarily 99 or 125 years, although we have come across longer and shorter terms in Wadhurst. Inevitably, the period of lease left reduces as time goes by. This is often ignored and only becomes a problem when the property needs to be disposed of or re-mortgaged. The fewer the years remaining the less it is worth and the more expensive it will be to extend the lease. Qualifying long lease owners in Wadhurst have the right to extend the lease for an additional ninety years in accordance with the 1993 Leasehold Reform Act. Please give careful consideration before putting off your Wadhurst lease extension. Putting off that expense now only increases the price you will ultimately have to pay for a lease extension
It is generally considered that a residential leasehold with more than 100 years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 35 years unexpired, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service will provide you enhanced control over the value of your Wadhurst leasehold, as your property will be more valuable and saleable in respect of 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.
Charlie was the the leasehold owner of a high value apartment in Wadhurst being marketed with a lease of a few days over 72 years left. Charlie on an informal basis spoke with his landlord being a well known London-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent to start with set at £200 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Charlie to invoke his statutory right. Charlie procured expert legal guidance and was able to make an informed decision and handle with the matter and readily saleable.
Last Spring we were approach by Mrs A Stewart , who acquired a one bedroom flat in Wadhurst in October 2001. We are asked if we could estimate the price would likely be for a ninety year extension to my lease. Similar homes in Wadhurst with an extended lease were valued about £295,000. The average ground rent payable was £45 invoiced quarterly. The lease ended in 2099. Given that there were 74 years outstanding we calculated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of professional charges.
Last February we were contacted by Mr and Mrs. G André , who completed a ground floor flat in Wadhurst in February 2007. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be for a 90 year extension to my lease. Similar properties in Wadhurst with 100 year plus lease were valued about £243,000. The average amount of ground rent was £65 collected annually. The lease elapsed on 22 August 2088. Having 63 years outstanding we calculated the compensation to the landlord to extend the lease to be between £20,000 and £23,000 plus expenses.