It’s a harsh certainty that a Whiteley residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the loss of value being disguised by increases in the Whiteley property prices.Once your lease gets to 85ish years, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls lower than 80 years - otherwise a higher premium will be payable. The majority of leasehold owners in Whiteley will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you qualify for an extension. In some cases you may not qualify. There are also strict timeframes and procedures to follow once the process is initiated and you will need to be guided by your lawyer from beginning to end of the formalities.
Leasehold residencies in Whiteley with in excess of 100 years outstanding 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 buying the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Using our service gives you enhanced control over the value of your Whiteley leasehold, as your property will be more valuable and saleable in respect of lease length should you wish to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Charlie owned a conversion apartment in Whiteley being marketed with a lease of just over fifty eight years left. Charlie informally spoke with his landlord being a well known London-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a rise in the rent to £50 annually. Ordinarily, ground rent would not be due on a lease extension were Charlie to invoke his statutory right. Charlie procured expert legal guidance and secured an acceptable deal without resorting to tribunal and sell the flat.
In 2013 we were called by Dr K Phillips who, having moved into a purpose-built apartment in Whiteley in February 2010. The dilemma was if we could approximate the compensation to the landlord would be for a 90 year extension to my lease. Identical properties in Whiteley with an extended lease were valued about £193,400. The average amount of ground rent was £65 billed quarterly. The lease ended in 2085. Given that there were 59 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £21,900 and £25,200 exclusive of professional charges.
In 2013 we were phoned by Mr and Mrs. C Richardson who, having completed a basement flat in Whiteley in May 1995. The question was if we could estimate the price would be to extend the lease by a further 90 years. Similar flats in Whiteley with 100 year plus lease were worth £255,000. The average ground rent payable was £50 invoiced yearly. The lease came to a finish in 2096. Given that there were 70 years unexpired we approximated the compensation to the landlord for the lease extension to be within £10,500 and £12,000 exclusive of legals.