As the length of the unexpired term of a Hilsea domestic lease decreases so does its value and therefore the value of your property. If the residual term has, over one hundred years remaining then this decrease may be negligible nevertheless there will become a stage when a lease has fewer than eighty years left as part of the premium you will incur is what is known as a marriage value. This could increase sharply the cost. It is the main reason why you should consider extending sooner than later. Most flat owners in Hilsea will qualify for this right; nevertheless a lawyer should be able to advise if you qualify for a lease extension. In certain situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
It is conventional wisdom that a property with over one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
Irrespective of whether you are a tenant or a freeholder in Hilsea,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Hilsea valuers.
Jacob owned a studio apartment in Hilsea being sold with a lease of a little over fifty eight years left. Jacob informally approached his landlord being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £50 per annum. Ordinarily, ground rent would not be due on a lease extension were Jacob to exercise his statutory right. Jacob procured expert legal guidance and was able to make an informed judgement and deal with the matter and ending up with a market value flat.
Ms K Martinez bought a one bedroom apartment in Hilsea in April 1999. We are asked if we could estimate the premium could be for a 90 year extension to my lease. Comparable residencies in Hilsea with an extended lease were worth £208,600. The mid-range ground rent payable was £60 collected monthly. The lease ran out on 13 August 2083. Taking into account 57 years remaining we calculated the compensation to the landlord for the lease extension to be between £30,400 and £35,200 exclusive of costs.
Dr Y Michel owned a studio flat in Hilsea in March 2002. The dilemma was if we could estimate the premium could be for a 90 year extension to my lease. Comparable residencies in Hilsea with an extended lease were worth £200,000. The average amount of ground rent was £50 billed per annum. The lease concluded in 2103. Taking into account 77 years left we calculated the compensation to the freeholder to extend the lease to be within £8,600 and £9,800 not including legals.