It’s an underpublicised truth that a Hastings 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 first few years due to the loss of value being disguised by increases in the Hastings property prices.Where your lease has approximately ninety years left, you should start considering a lease extension. If lease term drops below 80 years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property The majority of flat owners in Hastings will be able to extend under the legislation; however a conveyancer will be able to confirm whether you qualify for an extension. In some situations you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancer from beginning to end of the process.
Leasehold premises in Hastings with over 100 years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Chelsea Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
| 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 |
| Yorkshire Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
Regardless of whether you are a tenant or a landlord in Hastings,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Hastings valuers.
18 months ago Blake, started to get near to the eighty-year mark with the lease on his ground floor flat in Hastings. In buying his flat twenty years ago, the length of the lease was of no relevance. Luckily, he realised he would soon be paying way over the odds for Extending the lease. Blake was able to extend his lease just in the nick of time last September. Blake and the freeholder subsequently agreed on the final figure of £5,000 . If the lease had slid lower than 80 years, the figure would have gone up by at least £1,075.
Last Winter we were e-mailed by Mr and Mrs. N Walker , who bought a purpose-built flat in Hastings in January 2002. We are asked if we could estimate the price would likely be for a ninety year lease extension. Comparative homes in Hastings with an extended lease were worth £254,200. The average ground rent payable was £60 billed every twelve months. The lease concluded on 7 November 2077. Considering the 51 years remaining we calculated the compensation to the landlord for the lease extension to be between £43,700 and £50,600 not including professional charges.
Mr Finley González took over the lease of a garden apartment in Hastings in February 2000. We are asked if we could estimate the premium could be to extend the lease by a further 90 years. Comparative homes in Hastings with 100 year plus lease were worth £215,600. The average ground rent payable was £45 collected quarterly. The lease expired in 2088. Considering the 62 years unexpired we calculated the compensation to the freeholder for the lease extension to be between £18,100 and £20,800 plus expenses.