Westerham leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. It is the case that most Westerham tenants have the right to extend their lease by an additional 90 years by virtue of the 1993 Leasehold Reform Act. Where you are a leasehold owner in Westerham you should see if your lease has between 70 and ninety years left. In particular once the remaining lease term slips under eighty years, the amount payable for any lease extension sharply increases as part of the premium you pay is what is known as a marriage value
It is generally considered that a residential leasehold with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 35 years unexpired, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with undertake Westerham 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.
During the course of the last few months Edward, came critically close to the 80-year mark with the lease on his studio flat in Westerham. In buying his home two decades ago, the unexpired term was of minimal bearing. Fortunately, he recognised he needed to take action soon on a lease extension. Edward extended the lease just under the wire last April. Edward and the landlord who owned the flat above subsequently settled on the final figure of £6,000 . If the lease had gone below eighty years, the amount would have escalated by at least £1,050.
In 2013 we were called by Mr and Mrs. W Gray who, having completed a one bedroom flat in Westerham in February 2002. The question was if we could estimate the compensation to the landlord could be to prolong the lease by 90 years. Comparable premises in Westerham with a long lease were in the region of £295,000. The mid-range ground rent payable was £45 invoiced yearly. The lease elapsed in 2100. Taking into account 74 years left we estimated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 plus legals.
In 2010 we were phoned by Mr D Moore who, having owned a basement apartment in Westerham in July 2009. The question was if we could approximate the compensation to the landlord would be to prolong the lease by ninety years. Comparative flats in Westerham with an extended lease were worth £248,000. The mid-range ground rent payable was £65 invoiced quarterly. The lease came to a finish on 9 July 2089. Having 63 years unexpired we calculated the compensation to the landlord for the lease extension to be within £20,900 and £24,200 plus fees.