Unfortunately that a Ditchling residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the loss of value being disguised by increases in the Ditchling property market.Once your lease gets to 85ish years, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips lower than eighty years - otherwise a higher premium will be payable. Most leasehold owners in Ditchling will be able to extend under the legislation; however a lawyer should be able to clarify if you are eligibility. In some situations you may not qualify. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your lawyer for the duration of the process.
It is conventional wisdom that a property with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Lease extensions in Ditchling can be a difficult process. We recommend you get professional help from a lawyer and valuer well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring Ditchling lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
After lengthy discussions with the landlord of her studio flat in Ditchling, Catherine started the lease extension process as the 80 year mark was fast advancing. The transaction was concluded in February 2008. The freeholder’s costs were kept to an absolute minimum.
Last month we were approach by Dr Freya François , who acquired a one bedroom flat in Ditchling in April 2006. We are asked if we could estimate the compensation to the landlord would be to prolong the lease by an additional years. Similar premises in Ditchling with 100 year plus lease were in the region of £270,000. The average ground rent payable was £55 collected yearly. The lease terminated in 2100. Considering the 74 years left we calculated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 not including legals.
Dr Eliot Martínez bought a first floor flat in Ditchling in July 2001. We are asked if we could shed any light on how much (approximately) premium would be for a 90 year lease extension. Comparable properties in Ditchling with an extended lease were worth £166,400. The mid-range amount of ground rent was £60 collected quarterly. The lease elapsed in 2080. Having 54 years left we estimated the premium to the landlord for the lease extension to be between £32,300 and £37,400 plus costs.