Owning a flat usually means owning a lease of the property, which has a finite term of years. The lease will ordinarily be granted for a fixed period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Warsash. Inevitably, the term of lease left reduces over time. This may slip by relatively unnoticed when the property needs to be sold or refinanced. The shorter the lease the less it is worth and the more expensive it will be to obtain a lease extension. Qualifying long lease owners in Warsash have the legal entitlement to extend the lease for an additional 90 years under the 1993 Leasehold Reform Act. You should give due consideration before delaying your Warsash lease extension. Holding off the cost now likely increases the price you will eventually incur to extend your lease
It is conventional wisdom that a property with more than 100 years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 30 years unexpired, the residence will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with procure Warsash lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Sam was the the leasehold owner of a 2 bedroom flat in Warsash on the market with a lease of fraction over 61 years unexpired. Sam on an informal basis approached his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent at the outset set at £150 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Sam to exercise his statutory right. Sam procured expert advice and was able to make an informed decision and deal with the matter and sell the flat.
In 2014 we were phoned by Mr Charlie Roberts who, having acquired a first floor apartment in Warsash in February 1998. The question was if we could approximate the compensation to the landlord would be to extend the lease by 90 years. Comparable homes in Warsash with 100 year plus lease were valued around £300,000. The mid-range amount of ground rent was £50 billed per annum. The lease concluded in 2100. Having 75 years left we estimated the premium to the freeholder to extend the lease to be between £8,600 and £9,800 plus professional charges.
Dr Ryan Lambert was assigned a lease of a studio flat in Warsash in February 2006. The question was if we could estimate the price would be to extend the lease by ninety years. Comparable homes in Warsash with a long lease were worth £250,400. The mid-range amount of ground rent was £65 billed yearly. The lease finished on 13 April 2089. Taking into account 64 years left we estimated the compensation to the freeholder to extend the lease to be between £19,000 and £22,000 plus expenses.