The re-sale value of a leasehold property in Warlingham depends on how long the lease has left to run. If it is close to or less than 80 years you should expect difficulties on re-sale, so it is advisable to arrange for a lease extension ahead of purchasing. Ideally one should start the lease extension process when the lease still has 82 years to run so that formalities can be finalised prior to the 80 year mark. Statute enables Warlingham qualifying lessees to a 90 year extension added to their unexpired lease term (ie if your lease has 50 years remaining the statutory lease extension will provide a new term of 140 years). The intention of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold properties in Warlingham with over 100 years unexpired on the lease are sometimes 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 upside in purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Engaging our service will provide you increased control over the value of your Warlingham leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In 2014 Ethan, started to get close to the eighty-year mark with the lease on his ground floor apartment in Warlingham. Having purchased his property two decades ago, the length of the lease was of no concern. Thankfully, he became aware that he would imminently be paying way over the odds for a lease extension. Ethan extended the lease just in the nick of time in March. Ethan and the freeholder via the management company eventually settled on an amount of £5,000 . If the lease had dipped to less than eighty years, the premium would have escalated by at least £975.
Mr and Mrs. E Gunderson moved into a first floor flat in Warlingham in July 2008. The question was if we could estimate the compensation to the landlord would be for a 90 year extension to my lease. Identical properties in Warlingham with an extended lease were in the region of £191,000. The mid-range ground rent payable was £65 collected annually. The lease lapsed in 2083. Given that there were 58 years as a residual term we estimated the compensation to the landlord to extend the lease to be within £23,800 and £27,400 exclusive of costs.
An example of a Freehold Enfranchisement case for a Warlingham property is The Woodlands 95 Purley Park Road in April 2009. The Tribunals own valuation produced the figure of £37,912. This case affected 6 flats. The unexpired residue of the current lease was 78.32 years.