Unfortunately that a Whitstable residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the first few years due to the reduction being disguised by increases in the Whitstable property market.Where your lease has approximately ninety years left, you should start thinking about a lease extension. If the number of years remaining falls below eighty years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property Most leasehold owners in Whitstable will be able to extend under the legislation; however a lawyer should be able to confirm if you qualify for an extension. In some situations you may not qualify. There are also strict timetables and procedures to be adhered to once the process is initiated and you will need to be guided by your lawyer from beginning to end of the process.
It is conventional wisdom that a property with more than 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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; |
| Halifax | Minimum 70 years from the date 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you enhanced control over the value of your Whitstable leasehold, as your property will be more valuable and saleable in relation to the lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Liam owned a high value flat in Whitstable on the market with a lease of a few days over 59 years outstanding. Liam on an informal basis spoke with his landlord being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £200 annually. No ground rent would be due on a lease extension were Liam to invoke his statutory right. Liam procured expert legal guidance and was able to make an informed decision and deal with the matter and readily saleable.
Dr Louise López completed a purpose-built apartment in Whitstable in September 1995. We are asked if we could approximate the price could be for a ninety year lease extension. Comparative residencies in Whitstable with a long lease were in the region of £255,000. The mid-range ground rent payable was £50 billed annually. The lease finished on 27 June 2095. Taking into account 70 years as a residual term we approximated the compensation to the landlord for the lease extension to be between £10,500 and £12,000 plus legals.
Last Autumn we were phoned by Mr and Mrs. E Bell , who completed a basement apartment in Whitstable in November 2012. The question was if we could estimate the premium would be for a 90 year lease extension. Comparative flats in Whitstable with a long lease were in the region of £246,800. The mid-range amount of ground rent was £60 billed every twelve months. The lease finished on 13 October 2075. Having 50 years unexpired we approximated the compensation to the landlord to extend the lease to be within £44,700 and £51,600 not including fees.