It’s an underpublicised truth that a Winchelsea residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Winchelsea property market.Where your lease has approximately ninety years left, you should start thinking about 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 amount will be due. Most leasehold owners in Winchelsea will be able to extend under the legislation; however a conveyancer will be able to clarify if you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancing solicitor for the duration of the formalities.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years unexpired, the premises will be worth the same as a freehold for decades to come.
| 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. |
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Yorkshire 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. |
Lease extensions in Winchelsea can be a difficult process. We recommend you secure professional help from a lawyer and valuer well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Winchelsea lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Jasper was the the leasehold owner of a 2 bedroom flat in Winchelsea on the market with a lease of fraction over fifty eight years outstanding. Jasper on an informal basis spoke with his freeholder a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £100 yearly. Ordinarily, ground rent would not be due on a lease extension were Jasper to invoke his statutory right. Jasper obtained expert advice and secured an acceptable resolution informally and ending up with a market value flat.
In 2010 we were contacted by Dr Jackson Wilson who, having was assigned a lease of a purpose-built apartment in Winchelsea in July 2007. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be for a 90 year extension to my lease. Similar residencies in Winchelsea with an extended lease were in the region of £240,600. The average amount of ground rent was £60 collected monthly. The lease finished on 21 September 2088. Given that there were 62 years outstanding we calculated the premium to the landlord to extend the lease to be between £21,900 and £25,200 exclusive of legals.
Last Autumn we were called by Dr D Carter , who owned a studio flat in Winchelsea in October 2000. The question was if we could shed any light on how much (roughly) compensation to the landlord would likely be for a ninety year extension to my lease. Similar flats in Winchelsea with an extended lease were valued about £174,200. The mid-range ground rent payable was £55 collected annually. The lease elapsed in 2077. Given that there were 51 years left we estimated the compensation to the freeholder to extend the lease to be between £31,400 and £36,200 exclusive of fees.