There is no doubt about it a leasehold flat or house in Warsash is a wasting asset as a result of the diminishing lease term. Where the residual term has, more than 99 years remaining then this decrease may be fractional nevertheless there will become a point in time when a lease has fewer than eighty years unexpired as part of the premium you will incur is what is termed as a marriage value. This could increase markedly the cost. It is the main logic behind why you should extend the lease without delay. Most flat owners in Warsash will meet the qualifying criteria; however a conveyancer can confirm if you are eligible for a lease extension. In certain situations you may not qualify, the most common reason being that you have owned the property for less than two years.
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to any lease with more than 30 years left, the premises will be worth the same as a freehold for many years in the future.
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 |
| 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 Warsash,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Warsash valuers.
Henry owned a studio flat in Warsash being sold with a lease of just over 61 years left. Henry informally contacted his landlord a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £150 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Henry to invoke his statutory right. Henry obtained expert advice and was able to make an informed judgement and handle with the matter and ending up with a market value flat.
Dr George Simon moved into a newly refurbished apartment in Warsash in August 2008. We are asked if we could estimate the compensation to the landlord would likely be to extend the lease by 90 years. Identical properties in Warsash with 100 year plus lease were in the region of £243,000. The mid-range ground rent payable was £65 billed monthly. The lease concluded in 2088. Given that there were 63 years unexpired we estimated the premium to the landlord to extend the lease to be within £20,000 and £23,000 plus legals.
In 2013 we were contacted by Dr Connor Roberts who, having took over the lease of a garden flat in Warsash in July 2008. We are asked if we could estimate the premium could be to extend the lease by 90 years. Similar flats in Warsash with a long lease were valued around £181,600. The average ground rent payable was £55 collected quarterly. The lease came to a finish on 18 February 2077. Having 52 years left we estimated the premium to the freeholder for the lease extension to be between £30,400 and £35,200 not including professional charges.