With a long leasehold property in Tunbridge Wells, you are actually purchasing an entitlement to live in a property for a prescribed time frame. These days flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you should consider a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease gets disproportionately more expensive particularly once there are fewer than eighty years remaining. Anyone in Tunbridge Wells with a lease nearing 81 years remaining should seriously consider extending it sooner as opposed to later. When a lease has under eighty years left, under the current legislation the landlord is entitled to calculate and levy a larger amount, assessed on a technical calculation, strangely termed as “marriage value” which is payable.
Leasehold premises in Tunbridge Wells with more than 100 years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
Regardless of whether you are a tenant or a freeholder in Tunbridge Wells,the lease extension solicitors 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 Tunbridge Wells valuers.
Luke owned a 2 bedroom flat in Tunbridge Wells on the market with a lease of a little over fifty eight years unexpired. Luke on an informal basis contacted his freeholder a well known Bristol-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 an increased rent to £100 yearly. No ground rent would be due on a lease extension were Luke to exercise his statutory right. Luke procured expert advice and was able to make an informed decision and deal with the matter and sell the flat.
Ms Rebecca Gray purchased a studio apartment in Tunbridge Wells in September 1999. We are asked if we could approximate the price would be to extend the lease by ninety years. Comparable premises in Tunbridge Wells with a long lease were in the region of £210,000. The average amount of ground rent was £50 invoiced yearly. The lease lapsed on 28 September 2106. Taking into account 80 years as a residual term we estimated the premium to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of fees.
Mr Oliver André was assigned a lease of a ground floor flat in Tunbridge Wells in May 2002. The dilemma was if we could approximate the compensation to the landlord would likely be to extend the lease by ninety years. Identical properties in Tunbridge Wells with a long lease were valued around £275,000. The mid-range amount of ground rent was £45 billed per annum. The lease terminated in 2095. Having 69 years unexpired we approximated the premium to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of expenses.