The market value of a leasehold property in West Thurrock is impacted by how long the lease has left to run. If it is close to or fewer than 80 years you should anticipate difficulties on re-sale, so it is recommended to arrange for a lease extension before purchasing. It is preferable to start the process of extending the lease is when the lease still has 82 years to run so that a lease extension can be concluded prior to the eighty year mark. Leasehold Reform legislation entitles West Thurrock qualifying lessees to obtain a new lease which will be for the balance of the existing lease plus a further term of 90 years. The reason of the valuation is to determine the amount payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold premises in West Thurrock 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 premises. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
The lawyers that we work with procure West Thurrock 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 conveyancer we work with provide it.
After protracted discussions with the freeholder of her ground floor apartment in West Thurrock, Rachael initiated the lease extension process just as her lease was nearing the critical 80-year threshold. The transaction was finalised in July 2009. The freeholder’s costs were kept to an absolute minimum.
Last Christmas we were contacted by Mr and Mrs. T Rose , who owned a one bedroom flat in West Thurrock in March 2011. We are asked if we could shed any light on how much (roughly) premium would likely be for a ninety year lease extension. Similar properties in West Thurrock with a long lease were worth £218,000. The average ground rent payable was £45 collected yearly. The lease expiry date was on 8 November 2088. Considering the 63 years unexpired we calculated the premium to the landlord to extend the lease to be within £17,100 and £19,800 plus fees.
An example of a Lease Extension case for a West Thurrock premises is Various @ Colombus Square in January 2012. the Tribunal calculated the premiums to be paid for new leases for each of the flats in Mariners Walk to be £3822 and the premium to be paid for the new lease of 2 Knights Court to be £4439. This case affected 13 flats. The unexpired term was 76 years.