With a residential leasehold property in Whitstable, you are actually purchasing a right to live in a property for a set period of time. In recent years flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you should think about extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease becomes disproportionately more expensive notably when there are less than eighty years left. Leasehold owners in Whitstable with a lease approaching 81 years left should seriously consider extending it as soon as possible. Once a lease has below eighty years outstanding, under the relevant legislation the freeholder is entitled to calculate and levy a greater premium, based on a technical multiplication, strangely termed as “marriage value” which is due.
Leasehold residencies in Whitstable with in excess of one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges warrant 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| National Westminster Bank | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a landlord in Whitstable,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Whitstable valuers.
Subsequent to lengthy discussions with the landlord of her purpose-built flat in Whitstable, Isabella commenced the lease extension process as the eighty year threshold was fast nearing. The lease extension was finalised in August 2006. The landlord’s costs were restricted to slightly above 550 GBP.
Last year we were called by Dr Matthew Garcia , who bought a studio flat in Whitstable in November 2010. The question was if we could approximate the price could be to extend the lease by an additional years. Comparable flats in Whitstable with a long lease were valued about £254,200. The average amount of ground rent was £60 collected annually. The lease elapsed in 2076. Having 51 years outstanding we approximated the compensation to the landlord to extend the lease to be between £43,700 and £50,600 plus expenses.
Last Autumn we were phoned by Dr Chloe Ward , who owned a purpose-built flat in Whitstable in July 2010. The dilemma was if we could estimate the premium would likely be to extend the lease by a further 90 years. Comparable residencies in Whitstable with a long lease were worth £210,600. The mid-range ground rent payable was £45 invoiced monthly. The lease termination date was in 2087. Taking into account 62 years left we approximated the compensation to the freeholder for the lease extension to be within £18,100 and £20,800 plus legals.