It’s a harsh certainty that a Tunbridge Wells residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Tunbridge Wells property market.Once your lease nears 85ish years, 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 falls below eighty years - otherwise a higher amount will be payable. Most flat owners in Tunbridge Wells will be able to extend under the legislation; however a lawyer will be able to clarify whether you qualify for an extension. In some situations you may not qualify. There are also strict timeframes and procedures to be adhered to 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 Tunbridge Wells with in excess of 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Tunbridge Wells,the lease extension experts 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 Tunbridge Wells valuers.
Trailing lengthy negotiations with the freeholder of her first floor flat in Tunbridge Wells, Leah commenced the lease extension process just as her lease was nearing the crucial 80-year threshold. The transaction completed in September 2012. The landlord’s fees were restricted to slightly above 550 pounds.
In 2014 we were approached by Mr and Mrs. A Wilson who, having bought a purpose-built flat in Tunbridge Wells in August 2005. We are asked if we could estimate the price would be for a 90 year lease extension. Similar premises in Tunbridge Wells with a long lease were valued around £233,200. The mid-range amount of ground rent was £60 billed annually. The lease terminated on 13 April 2087. Having 61 years outstanding we calculated the compensation to the freeholder for the lease extension to be between £22,800 and £26,400 exclusive of fees.
In 2013 we were contacted by Ms Y Bernard who, having completed a one bedroom apartment in Tunbridge Wells in August 2000. The question was if we could estimate the price would be for a ninety year extension to my lease. Similar properties in Tunbridge Wells with a long lease were worth £166,800. The mid-range amount of ground rent was £50 collected every twelve months. The lease ended on 4 May 2076. Considering the 50 years remaining we estimated the premium to the freeholder to extend the lease to be within £32,300 and £37,400 exclusive of costs.