Unfortunately that a Hythe residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the Hythe property market.Where your lease has approximately ninety years left, you need to start thinking about 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 slips below eighty years - otherwise a higher amount will be payable. Most leasehold owners in Hythe will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm whether you are eligibility. In some cases you may not qualify. There are also strict timetables and procedures to follow once the process is instigated and you will need to be guided by your conveyancing solicitor throughout the process.
It is conventional wisdom that a property with over one hundred years remaining is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 45 years remaining, the property will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
Engaging our service gives you better control over the value of your Hythe leasehold, as your property will be more valuable and saleable in relation to the lease length should you want to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Oscar, started to get near to the 80-year mark with the lease on his studio flat in Hythe. In buying his flat 19 years previously, the unexpired term was of minimal concern. Fortunately, he realised he needed to take action soon on a lease extension. Oscar arranged for a lease extension just under the wire in March. Oscar and the landlord who owned the flat above subsequently settled on the final figure of £5,500 . If the lease had dipped to less than 80 years, the premium would have increased by at least £1,000.
Dr G Scott owned a garden flat in Hythe in April 2010. The question was if we could approximate the price would be for a 90 year lease extension. Comparable properties in Hythe with 100 year plus lease were worth £174,200. The mid-range amount of ground rent was £55 collected yearly. The lease lapsed on 28 September 2077. Taking into account 51 years outstanding we calculated the premium to the freeholder to extend the lease to be within £31,400 and £36,200 exclusive of professional charges.
Last Summer we were contacted by Mr Blake Michel , who moved into a one bedroom apartment in Hythe in June 2003. The question was if we could approximate the price would be to prolong the lease by an additional years. Similar flats in Hythe with 100 year plus lease were in the region of £285,000. The average amount of ground rent was £45 invoiced yearly. The lease finished on 15 June 2097. Considering the 71 years remaining we approximated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 exclusive of costs.