It’s a harsh truth that a Worthing residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Worthing property market.Where your lease has approximately 90 years left, you need to start considering 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 under 80 years - otherwise a higher amount will be payable. The majority of leasehold owners in Worthing will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you are eligibility. In some cases you may not qualify. There are also strict timetables and procedures to follow once the process is initiated and you will need to be guided by your conveyancer from beginning to end of the formalities.
Leasehold residencies in Worthing with more than one hundred years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Engaging our service gives you increased control over the value of your Worthing leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In the wake of eight months of protracted negotiations with the freeholder of her leasehold flat in Worthing, Paige commenced the lease extension process as the eighty year threshold was quickly approaching. The legal work was finalised in March 2014. The freeholder’s charges were kept to an absolute minimum.
In 2014 we were approached by Mr Alfie Díaz who, having acquired a studio flat in Worthing in November 2010. The dilemma was if we could approximate the premium could be to prolong the lease by ninety years. Comparable flats in Worthing with 100 year plus lease were in the region of £235,600. The average ground rent payable was £60 billed quarterly. The lease expired in 2088. Given that there were 62 years left we estimated the compensation to the freeholder for the lease extension to be between £21,900 and £25,200 plus professional charges.
Last month we were phoned by Mr and Mrs. T Davies , who purchased a first floor apartment in Worthing in November 1999. We are asked if we could shed any light on how much (approximately) compensation to the landlord could be to extend the lease by ninety years. Similar homes in Worthing with an extended lease were valued around £174,200. The mid-range ground rent payable was £55 billed per annum. The lease lapsed on 10 June 2077. Considering the 51 years remaining we estimated the premium to the freeholder to extend the lease to be between £31,400 and £36,200 exclusive of professional charges.