The market value of a leasehold property in Tunbridge Wells is impacted by how long the lease has left to run. If it is close to or less than 80 years you should foresee difficulties on re-sale, so it is advisable to arrange for the lease to be extended before purchasing. It is preferable to commence the lease extension process when the lease still has 82 years to run so that formalities can be addressed in advance of the eighty year threshold. Statute enables Tunbridge Wells qualifying lessees to an additional term of ninety years over and above the existing term, at a peppercorn 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 generally accepted that a residential leasehold with over 100 years remaining is worth roughly the equivalent as a freehold. Where an further ninety years added to any lease with more than 35 years remaining, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
| 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 |
Irrespective of whether you are a tenant or a landlord in Tunbridge Wells,the lease extension solicitors 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.
Eliot owned a studio flat in Tunbridge Wells on the market with a lease of fraction over 72 years left. Eliot informally approached his landlord a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £100 per annum and increase every 25 years thereafter. No ground rent would be due on a lease extension were Eliot to invoke his statutory right. Eliot obtained expert advice and was able to make a more informed decision and handle with the matter and ending up with a market value flat.
Last Christmas we were contacted by Dr Amber Kelly , who purchased a one bedroom apartment in Tunbridge Wells in November 2007. We are asked if we could approximate the price could be to prolong the lease by ninety years. Identical flats in Tunbridge Wells with a long lease were in the region of £171,800. The mid-range ground rent payable was £55 collected every twelve months. The lease end date was on 26 April 2075. Taking into account 50 years unexpired we estimated the premium to the landlord for the lease extension to be within £33,300 and £38,400 not including fees.
In 2009 we were called by Mr Joshua Cooper who, having purchased a first floor flat in Tunbridge Wells in February 2012. We are asked if we could approximate the price could be for a ninety year lease extension. Comparable premises in Tunbridge Wells with an extended lease were valued about £280,000. The mid-range ground rent payable was £45 billed per annum. The lease ran out in 2095. Given that there were 70 years unexpired we calculated the premium to the landlord to extend the lease to be within £12,400 and £14,200 plus fees.