Winchelsea 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 the lease gets more expensive. The majority of owners of residential leasehold property in Winchelsea enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Winchelsea you would be well advised to see if your lease has between seventy and 90 years left. In particular once the remaining lease term slips under eighty years, the compensation to the landlord for any lease extension sharply increases as an element of the premium you will incur is what is known as a marriage value
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth approximately the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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 are not acceptable. 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| 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 gives you enhanced control over the value of your Winchelsea leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Callum owned a high value apartment in Winchelsea on the market with a lease of fraction over 72 years unexpired. Callum on an informal basis contacted his freeholder a well known local-based freehold company for a lease extension. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £150 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Callum to exercise his statutory right. Callum procured expert legal guidance and was able to make an informed decision and deal with the matter and sell the flat.
Dr T Nelson moved into a first floor flat in Winchelsea in August 2002. We are asked if we could estimate the compensation to the landlord would be to extend the lease by an additional years. Comparative residencies in Winchelsea with a long lease were worth £285,000. The average ground rent payable was £45 collected every twelve months. The lease terminated on 22 June 2097. Having 71 years as a residual term we approximated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 plus expenses.
Last Autumn we were contacted by Mr and Mrs. S López , who was assigned a lease of a newly refurbished apartment in Winchelsea in October 1999. The dilemma was if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Identical premises in Winchelsea with 100 year plus lease were worth £225,800. The average amount of ground rent was £60 invoiced per annum. The lease concluded on 26 November 2086. Having 60 years remaining we approximated the compensation to the freeholder to extend the lease to be between £24,700 and £28,600 plus expenses.