The market value of a leasehold property in Margate depends on how many years the lease has remaining. If it is near to or less than eighty years you should envisage problems on re-sale, so it is recommended to arrange for the lease to be extended prior to buying. It is preferable to start the lease extension process when the lease still has 82 years remaining so that a lease extension can be addressed prior to the 80 year mark. Leasehold Reform legislation entitles Margate qualifying lessees to an additional term of ninety years over and above the unexpired term, at a nominal rent (no ground rent). The reason of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 45 years remaining, the property will be equivalent in value to 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Margate can be a difficult process. We recommend you obtain guidance from a lawyer and valuer with experience in this area.
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 dealing with Margate lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Mason owned a studio flat in Margate being marketed with a lease of a few days over fifty eight years remaining. Mason informally contacted his freeholder a well known Manchester-based freehold company for a lease extension. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £125 per annum. No ground rent would be payable on a lease extension were Mason to exercise his statutory right. Mason obtained expert legal guidance and was able to make a more informed judgement and handle with the matter and ending up with a market value flat.
In 2011 we were phoned by Mr and Mrs. T Rogers who, having completed a garden apartment in Margate in June 1999. The question was if we could estimate the premium would be to prolong the lease by 90 years. Comparable flats in Margate with a long lease were valued around £176,200. The average amount of ground rent was £65 billed every twelve months. The lease terminated in 2082. Considering the 56 years remaining we estimated the compensation to the freeholder to extend the lease to be between £29,500 and £34,000 exclusive of expenses.
Last Summer we were called by Mr S Allen , who was assigned a lease of a basement flat in Margate in April 1998. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to extend the lease by an additional years. Comparable flats in Margate with 100 year plus lease were worth £242,600. The average amount of ground rent was £45 collected monthly. The lease elapsed in 2093. Having 67 years remaining we estimated the premium to the landlord for the lease extension to be between £11,400 and £13,200 not including expenses.