Whitland leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. It is the case that most Whitland tenants have the right to extend their lease by an additional ninety years by virtue of the 1993 Leasehold Reform Act. Where you are a leasehold owner in Whitland you must check if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension increases dramatically as an element of the premium you pay is what is known as a marriage value
Leasehold properties in Whitland with over one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you enhanced control over the value of your Whitland leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Leon, started to get close to the 80-year mark with the lease on his two bedroom flat in Whitland. Having bought his home 18 years previously, the lease term was of minimal significance. Luckily, he recognised he needed to take steps soon on Extending the lease. Leon extended the lease just under the wire in March. Leon and the freeholder ultimately settled on an amount of £5,000 . If he failed to meet the deadline, the figure would have increased by a minimum £1,100.
In 2010 we were phoned by Mr and Mrs. J Pérez who, having moved into a ground floor flat in Whitland in October 1997. The question was if we could shed any light on how much (approximately) compensation to the landlord could be to prolong the lease by 90 years. Identical properties in Whitland with a long lease were worth £275,000. The mid-range amount of ground rent was £65 billed yearly. The lease elapsed on 3 August 2094. Given that there were 68 years left we calculated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of fees.
In 2011 we were phoned by Mr B Clarke who, having bought a one bedroom apartment in Whitland in April 2010. The dilemma was if we could shed any light on how much (roughly) price would likely be for a ninety year lease extension. Identical residencies in Whitland with 100 year plus lease were valued about £208,600. The average amount of ground rent was £60 billed quarterly. The lease came to a finish in 2083. Taking into account 57 years left we approximated the premium to the landlord to extend the lease to be within £30,400 and £35,200 exclusive of professional charges.