Westbourne leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. Legislation has been in place for sometime now which entitles qualifying Westbourne residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Westbourne you must check if your lease has between seventy and ninety years remaining. In particular once the remaining lease term slips under 80 years, the compensation to the landlord for any lease extension increases dramatically as part of the premium you will incur is what is known as a marriage value
Leasehold residencies in Westbourne with in excess of one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and maintenance charges justify 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. |
| Coventry Building Society | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 landlord in Westbourne,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 in-depth market knowledge and the close ties they enjoy with Westbourne valuers.
Half a year ago Harvey, came seriously close to the 80-year mark with the lease on his ground floor apartment in Westbourne. In buying his home twenty years previously, the unexpired term was of little bearing. Fortunately, he became aware that he needed to take steps soon on Extending the lease. Harvey arranged for a lease extension just ahead of time in April. Harvey and the landlord who owned the flat above eventually settled on sum of £5,000 . If he not met the deadline, the figure would have increased by a minimum £925.
Last Autumn we were called by Dr Olivia Rivera , who acquired a studio flat in Westbourne in October 2012. The dilemma was if we could shed any light on how much (approximately) premium would be to prolong the lease by ninety years. Identical residencies in Westbourne with an extended lease were in the region of £300,000. The average amount of ground rent was £50 collected yearly. The lease expired in 2101. Considering the 76 years outstanding we estimated the compensation to the landlord for the lease extension to be between £8,600 and £9,800 plus legals.
Last Summer we were e-mailed by Dr Aarav Baker , who purchased a one bedroom flat in Westbourne in May 1997. The question was if we could approximate the compensation to the landlord would be to prolong the lease by ninety years. Comparable homes in Westbourne with 100 year plus lease were worth £257,800. The average amount of ground rent was £65 billed monthly. The lease elapsed in 2090. Considering the 65 years unexpired we estimated the compensation to the freeholder for the lease extension to be within £18,100 and £20,800 not including professional charges.