It’s a harsh certainty that a Virginia Water residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the reduction being disguised by increases in the Virginia Water property prices.Once your lease nears 85ish years, you should start thinking about a lease extension. If lease term dips below eighty years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property The majority of flat owners in Virginia Water will be able to extend under the legislation; however a conveyancer will be able to confirm if you qualify for an extension. In some situations you may not qualify. There are also strict timetables and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancer from beginning to end of the process.
Leasehold premises in Virginia Water with over 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Chelsea 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. |
| Godiva Mortgages | 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. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Virginia Water,the lease extension lawyers 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 Virginia Water valuers.
Charlie was the the leasehold owner of a 2 bedroom apartment in Virginia Water being marketed with a lease of fraction over 59 years left. Charlie on an informal basis contacted his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £125 annually. No ground rent would be payable on a lease extension were Charlie to invoke his statutory right. Charlie procured expert legal guidance and secured an acceptable resolution informally and sell the property.
Last Winter we were contacted by Mr F Morris , who owned a one bedroom apartment in Virginia Water in March 2011. The question was if we could estimate the price could be to extend the lease by ninety years. Similar flats in Virginia Water with a long lease were worth £245,000. The mid-range amount of ground rent was £50 invoiced every twelve months. The lease termination date was on 7 April 2093. Taking into account 68 years left we estimated the compensation to the freeholder for the lease extension to be within £9,500 and £11,000 not including costs.
In 2013 we were called by Mr and Mrs. P Ramírez who, having moved into a one bedroom apartment in Virginia Water in February 2003. The dilemma was if we could shed any light on how much (roughly) premium could be to extend the lease by an additional years. Similar homes in Virginia Water with 100 year plus lease were worth £285,000. The average ground rent payable was £55 collected annually. The lease ran out in 2104. Having 79 years unexpired we approximated the compensation to the freeholder to extend the lease to be within £13,300 and £15,400 plus costs.