Witham 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 the lease gets more expensive. Most owners of residential leasehold property in Witham enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Witham you would be well advised to investigate if your lease has between seventy and 90 years left. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension increases dramatically as part of the premium you pay is what is known as a marriage value
It is generally accepted that a property with over one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with undertake Witham 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 conveyancer we work with provide it.
Following lengthy negotiations with the freeholder of her leasehold flat in Witham, Paige started the lease extension process just as her lease was coming close to the all-important 80-year mark. The lease extension completed in May 2008. The freeholder’s fees were negotiated to below four hundred pounds.
In 2013 we were called by Mr and Mrs. K Flores who, having was assigned a lease of a one bedroom apartment in Witham in February 2012. We are asked if we could estimate the price could be to extend the lease by a further 90 years. Similar premises in Witham with 100 year plus lease were valued around £208,200. The average amount of ground rent was £65 collected per annum. The lease terminated on 11 October 2087. Having 61 years left we calculated the premium to the freeholder to extend the lease to be within £20,000 and £23,000 exclusive of expenses.
Last Autumn we were contacted by Mr and Mrs. E Nguyen , who completed a purpose-built flat in Witham in August 1997. We are asked if we could estimate the compensation to the landlord could be for a ninety year extension to my lease. Identical properties in Witham with an extended lease were worth £260,000. The mid-range ground rent payable was £50 billed annually. The lease expiry date was on 19 September 2098. Considering the 72 years unexpired we estimated the premium to the landlord for the lease extension to be between £9,500 and £11,000 not including professional charges.