The re-sale value of a leasehold property in Witham is impacted by how long the lease has remaining. If it is close to or fewer than eighty years you should anticipate problems on re-sale, so it is recommended to arrange for the lease to be extended ahead of buying. It is preferable to start the process of extending the lease is when a lease still has 82 years remaining so that a lease extension can be finalised prior to the 80 year cut off point. Leasehold Reform legislation entitles Witham qualifying lessees to obtain a new lease which will be for the balance of the existing lease plus a further term of ninety years. The intention of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a property with more than one hundred years remaining is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Irrespective of whether you are a tenant or a freeholder in Witham,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Witham valuers.
Alexander owned a high value flat in Witham on the market with a lease of fraction over fifty eight years left. Alexander on an informal basis approached his landlord a well known London-based freehold company for a lease extension. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent to start with set at £200 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Alexander to exercise his statutory right. Alexander procured expert legal guidance and was able to make a more informed decision and deal with the matter and ending up with a market value flat.
In 2009 we were approached by Mr and Mrs. C Collins who, having took over the lease of a one bedroom apartment in Witham in February 2003. We are asked if we could approximate the premium would likely be to extend the lease by an additional years. Similar premises in Witham with 100 year plus lease were worth £255,000. The mid-range amount of ground rent was £50 billed quarterly. The lease came to a finish on 16 November 2096. Given that there were 70 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £10,500 and £12,000 not including professional charges.
Last Autumn we were contacted by Mrs Bethan Mitchell , who completed a garden flat in Witham in October 1996. We are asked if we could estimate the premium could be for a 90 year extension to my lease. Comparative flats in Witham with an extended lease were valued around £246,800. The average amount of ground rent was £60 billed yearly. The lease finished on 20 February 2076. Given that there were 50 years unexpired we approximated the compensation to the freeholder for the lease extension to be between £44,700 and £51,600 exclusive of costs.