Unfortunately that a South Woodham Ferrers residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the South Woodham Ferrers property market.Once your lease nears 85ish years, 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 dips under eighty years - otherwise a higher premium will be payable. The majority of leasehold owners in South Woodham Ferrers will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify if you qualify for an extension. In some situations you may not qualify. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer for the duration of the formalities.
It is generally considered that a property with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 30 years unexpired, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). 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; |
| Chelsea 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. |
| Halifax | Minimum 70 years from the date 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Engaging our service will provide you better control over the value of your South Woodham Ferrers leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Jasper owned a 2 bedroom flat in South Woodham Ferrers being sold with a lease of a few days over 72 years remaining. Jasper informally contacted his freeholder a well known London-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to an increased rent to £50 yearly. Ordinarily, ground rent would not be due on a lease extension were Jasper to exercise his statutory right. Jasper procured expert advice and secured an acceptable resolution informally and sell the flat.
In 2012 we were e-mailed by Dr L Robinson who, having took over the lease of a ground floor apartment in South Woodham Ferrers in October 2004. The question was if we could shed any light on how much (approximately) compensation to the landlord could be to extend the lease by a further 90 years. Comparable flats in South Woodham Ferrers with an extended lease were in the region of £173,800. The average ground rent payable was £65 collected per annum. The lease expiry date was in 2081. Having 55 years outstanding we estimated the premium to the freeholder for the lease extension to be between £31,400 and £36,200 exclusive of fees.
Mr and Mrs. A Cook took over the lease of a ground floor flat in South Woodham Ferrers in February 2001. The question was if we could estimate the compensation to the landlord could be for a ninety year extension to my lease. Comparative residencies in South Woodham Ferrers with 100 year plus lease were worth £235,200. The average amount of ground rent was £45 collected quarterly. The lease concluded on 3 March 2092. Taking into account 66 years outstanding we approximated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 not including costs.