It’s an underpublicised truth that a Shanklin residential lease is a wasting asset. As the lease term reduces so does the value of the property. 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 Shanklin property market.Where your lease has approximately 90 years left, you should start considering a lease extension. If lease term slips under 80 years, you will end up paying half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property The majority of leasehold owners in Shanklin will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify if you qualify for an extension. In some situations you may not qualify. There are also strict deadlines and procedures to follow once the process is instigated and you will need to be guided by your conveyancing solicitor for the duration of the formalities.
It is conventional wisdom that a property with more than 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 30 years left, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Regardless of whether you are a tenant or a landlord in Shanklin,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Shanklin valuers.
Subsequent to lengthy discussions with the freeholder of her studio flat in Shanklin, Ashleigh started the lease extension process just as her lease was coming close to the critical eighty-year threshold. The legal work completed in September 2012. The freeholder’s costs were restricted to slightly above 550 pounds.
Last year we were approach by Mr and Mrs. O François , who moved into a newly refurbished apartment in Shanklin in February 1998. We are asked if we could estimate the price would be for a 90 year extension to my lease. Comparative flats in Shanklin with an extended lease were in the region of £235,200. The average ground rent payable was £45 billed monthly. The lease finished in 2091. Given that there were 66 years remaining we calculated the premium to the landlord for the lease extension to be between £12,400 and £14,200 not including legals.
Last year we were called by Ms N Gray , who purchased a garden apartment in Shanklin in June 2004. We are asked if we could estimate the price could be to prolong the lease by a further 90 years. Comparative homes in Shanklin with 100 year plus lease were worth £280,000. The average ground rent payable was £55 billed monthly. The lease ran out in 2102. Taking into account 77 years outstanding we approximated the premium to the landlord for the lease extension to be within £13,300 and £15,400 not including expenses.